Contentious issues on Value-Added Tax and Sales Tax in Nigeria: A review of conflicting court decisions

• Author: Aaron, D.D.
• DOI: https://doi.org/10.47348/JCCL/V7/i2a1
• Published date: 09 November 2022
• Date: 09 November 2022
• Citation: (2021) 7(2) JCCL&P 1
• Pages: 1-15

https://doi.org/10.47348/JCCL/V7/i2a1

1

CONTENTIOUS ISSUES ON

VALUE-ADDED TAX AND SALES

TAX IN NIGERIA: A REVIEW OF

CONFLICTING COURT DECISIONS

DORIS DAKDA AARON*

Research Fellow, National Institute for Legislative and Democratic

Studies, National Assembly, Abuja

Abstract

Taxation is a universal means of revenue generation by governments

worldwide. It is the oldest form of revenue generation. Many

countries rely on taxes as an avenue for revenue generation to foster

development and improve the welfare of their citizens. There are

different types of taxes computed in line with the tax policies of

individual countries. Nigeria, like many other countries, relies on

taxes alongside other sources of revenue for its recurrent and capital

expenditure. The various taxes in Nigeria include value-added tax

(VAT), sales tax, company income tax and personal income tax. This

article looks at contentious issues arising from the implementation of

VAT and sales tax in Nigeria. The article adopts doctrinal methodology

by reviewing case law and tax legislation, and using a comparative

analysis approach. The article considers the provisions of the law

and their applicability in the Nigerian federal system of government.

The article also considers the powers of the federal and the state

governments in respect of VAT and sales tax. The article finds that

a major challenge in the implementation of VAT and sales tax in

Nigeria is the debate between the states and the federal government

of Nigeria about which tier of government has power over VAT and

sales tax. The article recommends that states should be allowed to

have power over VAT and sales tax alongside the federal government,

as occurs in other federal settings. In addition, the end users of most

consumable items are domiciled in the various states of Nigeria.

Keywords: sales tax, value-added tax (VAT), legislative competence,

doctrine of covering the field

* LLB (University of Jos, Nigeria) LLM (University of Lagos, Nigeria) PhD candidate

(University of Abuja, Nigeria).

(2021) 7(2) JCCL&P 1

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