Article Details

A critical overview of Value Added Tax (VAT) administration in the context of the contemporary contentions between some states of the federation and the Federal Government of Nigeria became necessary because of the strategic importance of VAT, as a major source of revenue generation in the country. Value-added tax has not only become the fastest-growing tax revenue in Nigeria, but the constitutional lacuna which could not explicitly indicate the tier of government that should collect VAT in a country that operates a federal system has led to some controversies in the administration and generation of VAT revenue between the different tiers of governments. The research adopted an interdisciplinary method and depended on the use of secondary sources. Using federalism as a general theory with fiscal federalism as its other thread, the paper analyzes the controversy between the Federal Inland Revenue Services (FIRS) and some states in Nigeria in the collection of VAT. Findings showed that the contentious issue of the jurisdiction of VAT administration between the federal and state governments is a product of the void created by the 1999 Constitution (as amended) with negative implications on the Nigerian economy. Therefore, the paper concluded that national legislation with unambiguous provisions is necessary for VAT administration and economic development in Nigeria.

Value Added Tax, Revenue, Conflicts, National Assembly, Fiscal federalism,