Filipatali, T. (2013). There is no one route that cities can or should take to boost revenues. Strategic control and revenue generation: A critical success factor in local government using the balanced scorecard. /Resources << B)`g5(^S1,=ql&{YwEzLgH`g\zwnka \ji2(-.$(ULd\y=fUgW +Oq^!PEcmht?&TV)nP-kqs+Y: Taxation as a Source of Revenue Generation in Local Governments, Nigeria Authors: Augustine Osho Ekiti State University, Ado Ekiti David Adelagun Ajayi Abstract and Figures period of 5years. . /Font << xo A>a#dkU(0 KJ@C2aOb4a&MoZ(K#YWa-SI{;E zubQ?$6 J&/oB50uvF>LO>Cw~N.1~,s%8#/A"akFu^6V07ST]hi/p4g8GtC? _X*O9H+CaB(ErQK]0K|d)F2t4a6ntHFcjdiD 7 At the same time, most states place restrictions on local property taxation, with limits that fall into three main types: rate limits, assessment limits, and levy limits. 0000002251 00000 n /ExtGState << To mobili"e and utili"e both human and material resources by engaging the. Predicting Municipal Fiscal Distress: Aspiration or Reality? Cambridge, MA: Lincoln Institute of Land Policy. What is the TCJA repatriation tax and how does it work? In so doing, they impose some taxes and rates on these economic activities as a way of generating funds for their Some are widely practiced, while others represent emerging and innovative options for city governments to pursue. /Font << /XObject << endstream /Font << What is global intangible low-taxed income and how is it taxed under the TCJA? Charges and miscellaneous fees, such as water, sewerage, and parking meter fees collected by municipal or county governments, provided $385 billion (23 percent of local general revenue). x]s63|:oNg$8Sw}hKM7?.~Vb@g6v|Y,j]w2_~yv6IDltsLDI%:nCSq251Le,qGO2-y5E 6X6> iq#"K%J3#GfF/_F ?V]pq^Te%&zuD`~>EgFY3c87Hlt9@)Ov?"c" @]TLlJaZg=40P//^E5uTxR4nhs7=pOCezQ&6.6+`,^M:|"T|m|'wo'Sc^e~abN77`& 8E9"m @}_6l?\Lzw]$1%gVv!CBJi`UY! Who would qualify for return-free filing? 12 0 obj https://www.grin.com/document/293498. How did the TCJA change the standard deduction and itemized deductions? For example, cities could institute new charges for the disposal of food waste. Cities can also raise revenues by increasing the number of transactions through various approaches. 9 /Resources << Theoretically the study was supported with the Efficiency and Development theories. Each time, the city brought in $7 million to $9 million in revenue. (2022). How are different consumption taxes related? To serve as an intermediary between government at the center and local communities. 0000003920 00000 n Revenue generation in Nigeria local governments is principally derived from tax. Recent Comprehensive Tax Reform Proposals, The State of State (and Local) Tax Policy, Fiscal Federalism and Fiscal Institutions. >> <>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 11 0 R 16 0 R 19 0 R 22 0 R 23 0 R] /MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> /Tabs /S /GS31 30 0 R hv-oRv9[Plq ?#o-.mOqi@}Fdl(d]i&y-tIT>=#'K/+EmKO+pe>"J*#9(tG_0Yb,UfR`En`o7So^ By doing so, the people's interest would be geared towards giving their maximum support to the local government which would lead to the development of the rural area? >> %PDF-1.4 Why is the VAT administratively superior to a retail sales tax? >> How do phaseouts of tax provisions affect taxpayers? /StructParents 2 %PDF-1.5 To address this problem, requires proper implementation of plans directed at enhancing adequate revenue generation. Whats the difference between front-loaded and back-loaded retirement accounts? Are the Social Security trust funds real? When renegotiating existing leases, several levers can be utilized, such as increasing allowable floor-to-area ratio (FAR), collecting penalties for violations, amending contract duration and payment terms, and modifying plot use. Cities that want to implement new charges will be more likely to build public support if such measures both induce positive behavior and have a clear, equitable, and risk-averse public benefit. (eds) The Political Economy of Colonialism and Nation-Building in Nigeria. How do state estate and inheritance taxes work? What is the size of the opportunity? endobj A limited number of charges and taxes ensures higher social acceptance and minimal collection leakage. <> What are the sources of revenue for local governments? >> Local governments include county governments, municipalities, townships, special districts (such as water and sewage authorities), and school districts. Local government administration in Nigeria: A comparative perspective. /Image8 18 0 R out of variations from the revenue generation capacities of component units. /Meta37 37 0 R What is return-free filing and how would it work? Urban Institute, Brookings Institution, and individual authors, 2022. Local government personnel can be trained to administer simple but adequate revenue generation instruments. endobj revenue generation and the development of the rural areas using Ikorodu local government in Lagos Nigeria. endobj Hassan, M. M. (2011). Today, the LGDF receives only 6.06% of total personal income tax the state receives, a reduction . How do state earned income tax credits work? We'll email you when new articles are published on this topic. To guide price hikes, cities could use benchmarks to determine the acceptable range. 3. What is carried interest, and how is it taxed? We strive to provide individuals with disabilities equal access to our website. What kinds of tax-favored retirement arrangements are there? Finally, cities could introduce new types of service fees, fines, and chargesand in so doing, create new sources of revenue. How do state and local corporate income taxes work? Each time, the city brought in $7 million to $9 million in revenue. All other taxesincluding corporate income taxes, hotel taxes, and business license taxesprovided $40 billion in revenue (2 percent). For example, the federal government sends K-12 education funds to state governments that then distribute the money to local governments. City of Los Angeles Department of Public Works, Bureau of Engineering standard fee list. >> /Image87 74 0 R Global Journal of Management and Business Research Administration and Management, 13(4), 1226. Elected officials have four primary revenue sources, each containing multiple levers. /GS31 30 0 R Aravind Boddupalli, Tracy Gordon, and Lourdes German (2021), State and Local Government Revenues and Racial Disparities state and local government with a recommendation that conscious effort be made to allocate more revenues to states and local governments. Hb``$WR~|@T#2S/`M. /Font << /F6 25 0 R /F5 40 0 R >> You may be shifting priorities daily in order to address the effects of the crisis on your constituents. /F5 40 0 R Uhunmwuangho, S. O., & Aibieyi, S. (2013, July). /Meta77 66 0 R << /Contents 43 0 R What would the tax rate be under a national retail sales tax? /Contents [14 0 R 15 0 R 16 0 R] /CS /DeviceRGB As such, federal transfers as a share of local general revenue will likely look different for these yearsbut Census has not yet published that data. International Journal of Economics, Commerce and Management, 3(6), pp. Before the crisis, long-term structural deficits were persistent for both individual governments and the entire sector as spending plans and patterns outpaced governments' revenue-generating capacity. State governments collected $2.2 trillion of general revenues in 2019. What is the schedule for the federal budget process? /S /Transparency /GS31 30 0 R >> recommended that the local government should provide basic amenities of high quality. As a result of these twin trends, a majority of the municipalities around the world are struggling to increase revenues while facing structural budget shortfalls that threaten service delivery and quality. >> Assessing Fiscal Capacities of States: A Representative Revenue SystemRepresentative Expenditure System Approach, Fiscal Year 2012. Washington DC: Urban Institute. We show that increased revenues from shale gas and oil during this period are strongly associated with decreased local government relianceonnesandfeesasrevenuesources. 4 0 obj Dubai instituted a knowledge dirham, a flat charge that applies to all government services. Revenue Generation in Local Government Areas (Problems and Prospects) Filed in Accounting Project Topics, Current Projects by TMLT Editorials on July 20, 2021 /F5 40 0 R /Meta57 46 0 R Rakson Nigeria Ltd. Okotoni, O. >> Tax is a compulsory levy imposed by government on individuals and companies, for the various legitimate function of the state (, Tax is a necessary ingredient for civili"ation. In general, this intervention represents the horizon for innovation across all revenue streams. What did the Presidents Advisory Panel on Federal Tax Reform say about the national retail sales tax? How have the sources of revenue for state and local governments changed over time? This preparatory work generally consists of collecting the relevant data and developing the current revenue baseline. What is the difference between a tax-exclusive and tax-inclusive sales tax rate? How does the tax exclusion for employer-sponsored health insurance work? What are state balanced budget requirements and how do they work? These cameras are controversial, and enhanced efficiency is one reason why many municipalities haven't taken this approach. 7, 192209. Local governments created with administrative and financial autonomy have two sources of revenue (internal and external) to promote development at the grassroot. Development which is a necessity in every society can be achieved to a great extent with adequate resources. /Meta49 54 0 R >> What is the tax treatment of college and university endowments? % x- [ 0}y)7ta>jT7@t`q2&6ZL?_yxg)zLU*uSkSeO4?c. R -25 S>Vd`rn~Y&+`;A4 A9 =-tl`;~p Gp| [`L` "AYA+Cb(R, *T2B- The finding revealed that there is an average relationship between local government finance and development as other factors like proper utilization and administrative competence are necessary in development. /XObject << >> In 2019, 4 percent of local government general revenue came directly from the federal government (e.g., federal funds for local transportation projects) and 31 percent came from state governments (the numbers do not sum to the total share from intergovernmental transfers because of rounding). 10 /Group << >> >> Since 1977, the share of local general revenue from taxes has remained steady at about 40 percent. Charges and taxes. AMA is one of the most resourced MMDAs How would the tax system need to change with return-free filing? This category involves enhancing internal effectiveness of city teams to generate more revenues without visible impact to the public. /StructParents 9 How does the current system of international taxation work? Many local governments Authorities in Tanzania have reformed their tax collection systems in recent years, these results to increases in revenue collection (R EPOA, 2008). Revenue generation in Nigeria local governments is principally derived from TAX. /Annots [86 0 R 87 0 R 88 0 R 89 0 R] In 2020 and 2021, Congress transferred a large amount of funds to local governments as part of the CARES Act . Cities use fines as both a deterrent for behavior at odds with the public goodfor example, the accumulation and nondisposal of garbage or building construction without a temporary fenceand a revenue source. 0000000016 00000 n This intervention is typically applicable to any paper-based transactions or services, such as business license fees, construction permit fees, or land registration fees. /Annots [27 0 R 28 0 R] /Tabs /S The Local Government Act 462 of 1993 authorises and empowers the district assemblies to mobilise revenue in the form of rates, fees & fines, licences, rent, among others to help finance projects in their various areas of authority. /Font << To meet rising expectations for service delivery amid tight budgets, municipal governments must increase revenues from existing sources as well as create new revenue streams. %PDF-1.5 /Image8 18 0 R >> 3. Even though what the local government had generated from internal and external sources have impacted the area to an extent, local government finance system i.e. The data was analyzed using simple percentage and frequency for primary data and content analysis for secondary data. /ModDate (D:20131230000155+10'00') Global Journals Inc. (USA). <>stream /F6 41 0 R A new tax on plastic would raise revenues and also benefit the environment. The potential effect on electricity prices is discussed in the Additional Comments section below. What are the sources of revenue for local governments? The Nigerian political system is of a federal one which implies that all the three tiers of government should each function to provide good, << Ayodele, I. O., & Sunday, A. E. (2009). Local tax limitations: a primer Property taxes . /Resources << Keywords: Local Government, Administration, Finance, Decentralization, Nigeria, Iwo Introduction One area which has remained neglected over time by the local governments in Nigeria is revenue generation. Revenue generation is the main source of income to the Federal, State and local Governments. 3 0 obj Urban-Brookings Tax Policy Center. How might low- and middle-income households be encouraged to save? << Ola Ventures. /CS /DeviceRGB Perhaps the simplest and most straightforward approach across each of the four revenue streams would be to charge more. /Producer (iText 1.3 by lowagie.com \(based on itext-paulo-153\)) /Type /Pages /XObject << As such, federal transfers as a share of state general revenue will likely look different for these yearsbut Census has not yet published that data. Contemporary issues in local government administration in Nigeria. Furthermore, technological advancements can aid increased surveillance. /MediaBox [0 0 595.32 842.04] >> 2. /F5 40 0 R /Contents 80 0 R The share coming from property taxes fell from 22 percent of general revenue in 1977 to 17 percent in 1985, but since then property taxes as a share of general revenue have been relatively stable. Lucy Dadayan and Kim Rueben (2021), More Than Fines and Fees: Incorporating Equity into City Revenue Strategies In 2020 and 2021, Congress transferred a large amount of funds to local governments as part of the CARES Act, the Coronavirus Response and Relief Supplemental Appropriations Act (part of the December 2020 omnibus bill), and the American Rescue Plan. 9evelopment is highly associated #ith, much revenue is needed to plan, execute and maintain infrastructures and facilities, developmental pro%ects li$e construction of accessible roads, building of public, schools, health care centers, construction of bridges among others are sources, generated from taxes, royalties, haulages, fines and, international governments. >> << University Press. /ProcSet [/PDF /Text /ImageB /ImageC /ImageI] What is foreign-derived intangible income and how is it taxed under the TCJA? /Count 10 Thus, the 'ocal government cannot embar$, execute, and possibly carryout the maintenance of these pro%ects and other responsibilities, This is the basic reason #hy development is s$eletal at some 'ocal -overnment, councils in Nigeria. 12 0 obj 92so74oi J. (*(%8H8c- fd9@6_IjH9(3=DR1%? For cities and counties, property tax revenue makes up 61% of own-source tax revenuerevenue from taxes the local government leviesby far their largest tax source. /Contents 79 0 R <> <>stream /CS /DeviceRGB 'ocal governments in, over a number of years. >> New York, Scribner Press in Institute of Management and Leadership Professional Nigeria (2012). To establish this dedicated unit, cities could create a cross-functional workforce with representatives from different departments, including finance, planning, property, legislation, and key municipalities. /Type /Page International Business Management, 3(3), 5460. endobj % 5 0 obj How do state and local individual income taxes work? 0000003592 00000 n It is as easy to achieve fiscal decentralization under a unitary system of government as under a federal system. /Meta40 35 0 R /F3 84 0 R endobj general sales taxes and gross receipts taxes, Coronavirus Response and Relief Supplemental Appropriations Act, federal funds for local transportation projects, Surveying State Leaders on the State of State Taxes, More Than Fines and Fees: Incorporating Equity into City Revenue Strategies, State and Local Government Revenues and Racial Disparities, Assessing Fiscal Capacities of States: A Representative Revenue SystemRepresentative Expenditure System Approach, Fiscal Year 2012, Governing with Tight Budgets; Long Term Trends in State Finances, Center on Labor, Human Services, and Population, Metropolitan Housing and Communities Policy Center, 8 percent from selective sales taxes on purchases such as, 2 percent from selective sales taxes on purchases such as, 3 percent from other taxes such as a locality'staxes onhotel bookingsandrestaurant meals. 5/27/2020. Performance meetings should be scheduled on a weekly basis to track revenue generation and build ownership. The Political Economy of Colonialism and Nation-Building in Nigeria, https://doi.org/10.1007/978-3-030-73875-4_17, Shipping restrictions may apply, check to see if you are impacted, https://www.odi.org/events/282-innovations-poverty-reduction-role-local-government, Political Science and International Studies, Political Science and International Studies (R0), Tax calculation will be finalised during checkout. Governments should ensure that fee levels cover the costs of services being provided in the majority of cases. Meanwhile, individual income taxes have also increased as a percentage of state and local general revenue, providing 10 percent in 1977 and 13 percent in 2019. Taxes, fees, and user charges are considered "own-source" revenue. /F1 20 0 R /F5 40 0 R "F$H:R!zFQd?r9\A&GrQhE]a4zBgE#H *B=0HIpp0MxJ$D1D, VKYdE"EI2EBGt4MzNr!YK ?%_&#(0J:EAiQ(()WT6U@P+!~mDe!hh/']B/?a0nhF!X8kc&5S6lIa2cKMA!E#dV(kel }}Cq9 Loay AlMujadidi is a consultant in McKinseys Riyadh office; Christian Azoury is an associate partner in the Dubai office, where Dirk Schmautzer is a partner; and Jonathan Woetzel is a senior partner in the Shanghai office and a director of the McKinsey Global Institute. What is the Highway Trust Fund, and how is it financed? Local government revenue comes from property, sales, and other taxes; charges and fees; and transfers from federal and state governments. % The American Recovery and Reinvestment Act of 2009 created a sharp uptick in transfers from the federal government between 2009 and 2011, peaking at 25 percent of state and local revenues in 2010 and 2011, before falling back to 22 percent in 2012. 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