AN APPRAISAL OF THE PAY AS YOU EARN SYSTEM OF TAXATION UNDER NIGERIA LAW

ABSTRACT Globally, taxation has been the heart and core to modern development because it has always being one of the formidable options to generate revenue for government. The Pay- as- you- earn system of taxation is system whereby individuals pay according to their income, in this system of taxation the tax burdens on individuals differs. This study examined the Pay- as- you- earn system of taxation under Nigeria law with the view of enlightening tax payers on the importance of paying tax, their rights as tax payers, the reliefs available for taxpayers, the designated bodies for resolving tax-related disputes, the challenges and prospect for the reform challenges of the Pay- as- you- earn system of taxation. This study was executed using a doctrinal research method where solely specific scholarly work and law was used as legal laws such as primary and secondary sources of law, journals case studies, legal articles, student papers, and legal textbooks related to the subject matter were consulted to get relevant fact and information to facilitate the research. From the findings of this study, it was discovered that the Pay- as- you- earn system of taxation has some loopholes which has made individuals paying income tax to believe that the government has been exploiting them and this have also made such individuals inconsistent in the payment of their tax. For the purpose of this study, we considered the challenges faced with the Pay- as- you- earn system of taxation such as problems of assessment, personnel problem and low image of tax officials, mismanagement of taxes collected by the government etc. Therefore, this study recommends that the Pay-as-You-Earn taxation system, utilized by the government to generate revenue, should focus on creating additional employment opportunities for individuals in order to generate more revenue for Nigeria. It should also emphasize educating people on the advantages of tax payment and ensuring that the taxes collected are used appropriately and effectively.