LEGAL APPRAISAL OF TAXATION OF SMALL AND MEDIUM BUSINESS ENTERPRISES IN NIGERIA

By

Author

Presented To

Department of Law

ABSTRACT
The tax regime of small and medium business enterprises was a snow ball of international agitation specially international monetary fund (IMF). To Nigeria Government to diversify her revenue base from Petroleum tax which consisted of 80% percent of the total revenue. Consequentially, the idea of SMBE tax was introduced in furtherance of tax reforms a committee was constituted in 1991 and January 1993, after the feasibility study of SMBE the report submitted to the Federal government with a recommendation to introduce SMBE Tax. On the other hand, the government viewed Small and Medium Business Enterprises as a very important sector of the economy that has employed many persons. Most big companies started at this level before progressive and attractive. That is why the government has paid special attention to it and as a sector to the Nigerian economy, it is still not progressing as expected and the resultant effect is still far beyond expectations. The objectives of this research are to analyze the effect of tax policy in the growth of SMBE in Nigeria. The methodology employed in this work is the doctrinal method. The problem of this research is despite the tax policies put in place for rapid growth of the sectors in returns for the government to drive huge revenue from it has fail because it is not in commiseration with the government intensions as a result of the following? Over taxation is also a problem of SMBE that is meant to be promoted, encouraged and made very attractive for potential investors in the country and the world as a whole. Also it reveled that tax collectors are not well trained and informed about government policies as regards the protection and encouragement of Small and Medium business Enterprises in Nigeria. Most particularly, they do not consider the size of a particular business in tax assessment. To proffer some solutions, tax assessment and collection should be defined with respect to which government should collect certain taxes from Small and Medium business Enterprises. This will avoid the three tiers of government collecting taxes from the same particular organization. Government should also put a policy in place to avoid illegal taxes, such as community levy, boys or youth levy as well as association or union levy, also Some of the findings arrived at in this study are absence of a harmonized and gazzetted tax regime, which would enable manufactures to build in recognized and approved levies and taxes payable and also the fact that an effective administration of this sector is lacking there should be an average or tax exemption placed on these young industries to encourage and protect them and to attract potential investors.