In August, the Federal High Court sitting in Rivers State, declared that the Rivers State Government and not the Federal Government of Nigeria is entitled to legislate on and collect Value Added Tax(VAT) within the state. Whilst this judgement may not necessarily speak to the conversation around the overall width of Nigeria’s tax net/bracket, it invariably draws attention to the specific width of the Federal Government’s earnings via taxation.
However, the focus of this disquisition is not the on goings around the current court dispute as it is beyond that. This article seeks to draw attention to the reality of the small tax net (further threatened by the Federal High Court decision) of not just the Federal Government but indeed, governments across all levels in Nigeria. In doing so, it draws attention to the dire need for a paradigm shift from the current status quo into the unexplored waters of other tax avenues as a critical source of generating revenue for the Nigerian state and her people.
Perhaps a convenient point to start from is to first adopt a working understanding of what is meant by the term “informal sector”. In its basic
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