EFFECT OF VALUE ADDED TAX ON A PROFITABILITY OF MANUFACTURING FIRM

📄 Project Abstract

There are quite a number of definitions of tax or taxation depending on the qualities it poses. In that vein, taxation is the process or machinery by which communities or group of persons are made to contribute in some agreed quantum and method for the purpose of the administration and development of the society (Adedeji, 2010). Taxation is the system of imposing levy by the government against the income, profit or wealth of the individual, partnership and corporate organization (Aluko, 2009). In the present dispensation of Nigerian economy, taxation has always been a means by which communities are provided with common facilities such as access roads, security, amongst others from time immemorial. In Nigeria, sales tax came into being in 1986. VAT introduction in 1993 heralded the abolition of sales tax. According to Anyafor, (2006), the rationale behind replacing sales tax with VAT is informed by the following reasons; 1. The base of the sales tax in Nigeria is narrow. It covers only ...