DESIGN AND IMPLEMENTATION OF A DATA BASE MANAGEMENT MODEL FOR INTERNAL REVENUE GENERATION

CHAPTER ONE

INTRODUCTION

1.1     Background of the Study

Revenue generation in Nigeria Local Government is principally derived from TAX. Meanwhile, Tax is a compulsory levy imposed on individual or companies for the various legitimate functions of the state (Vossen, 1991). Tax is a necessary ingredient for civilization. The history of man has shown that man has to pay tax in one form or the other, that is either cash or in kind, initially to his chieftains and later in a form of organized Government (Stephen Chuck, 2006). No system or rule can be effective whether foreign or native unless it enjoys some measure of financial independence. Local Government in Nigeria has developed over the years. Historically, the development of direct taxation in Local Government in Nigeria can be traced to the period before the British pre-colonial era. Under this period, community tax where levied on communities (Lucey, 1991).

Recently, the revenue generation of the Local Government is derived from two main sources, external source and internal source. External sources include statutory allocation to the Local Government from the State Government to the Local Government in its area of Jurisdictions, borrowing from State Government and other financial institutions, statutory allocation from the Federal account, local rates on markets and shops. While the internally generated sources of finance include local rates, market taxes, bicycles, trucks, canoes, wheel barrow rates, mechanic shops and so on. Other means of internally generated revenues by the Local Governments are fine charged by customary courts, Local Government business investment rates, fees from schools established by Local Government, shops rates, license fee, marriage registration fee, birth registration fee, Naming of street registration fee excluding any street in the State Capital, tax payable by cattle farmers, merriment on road closure levy, refuse disposal fees, fee collected from amusement centers established and operated by local authorities and so on.

1.2     Statement of the Problem

In spite of the above source of revenue as stated in the background of the study, the Local Government in Nigeria are faced with a lot of difficulties to manage revenue information which are generated internally within their area of Jurisdiction. Such problems are:

• The dishonesty on the part of the Local Government Officers in charge of revenue collection which always resulted to a poor internally generated revenue within the Local Government.
• The Machinery put in place for collection of revenue are inadequate hence, most of the Government money is not always collected and this always result to poor generation of funds within the Local Government
• The improper handling of the documents used for the collection of Local Government revenue by the Officers involved gives a proper picture about the whole exercise and thereby enabling the difficulties in managing the exercise by the Local Government administration.

These above mentioned problems necessitate the need to developing a computerized application model for the Internally generated revenue of Local Governments, which can go a long way to monitor and process the internally generated information of the Local Government and thereby reduce some of these mentioned problems.

• Aim and Objectives of the Study

Any application model like this is being motivated by some reasons. Hence, this application model for Local Government internally generated revenue is not an exception. Some of the purposes of this study are:

• To ensure accuracy of final result of internally generated revenue information within the Local Government.
• To prevent the internally generated revenue information within the Local Government from destruction (damage) in case of fire accident.
• There is a need to embrace ICT in our Local Government to reduce the level of paper work within the Local Government.
• The knowledge of the techniques of developing a data base management model for internally generated revenue for a Local Government is an Exceptional purpose of this study.

1.4     Significance of the Study      

The Local Government is a Government at the Local level established by the law to perform some specific functions within defined areas (Charles, 2001). Local Government is vested with substantial powers to take control over Local affairs. In doing this, the Local Government brings Government to the level of the people.

According to Chiemeka and Agbokhare, (2006), managing the Local Government requires a proper administration which gave rise to sub-division of the Local Government into Departments. They are Personnel system, bursary system and audit system (unit). In the past, papers were mainly used in processing every information within the sub-division in the Local Government affairs, this is also applicable mainly to the Local Government.

• Research Questions

Some of the research questions to this study are stated        below.

1. What are the aim and objective of Local Government creation in Nigeria?
2. How does Local Government in Nigeria finance the project within their Jurisdiction?

• What are the main sources of revenue to the Local Government?

1. How does Local Government generate their revenue internally?
2. What are the challenges faced by the Local Government in managing the internally generated revenue during and after revenue generation?
3. How can these challenges be properly addressed in order to have a more preferred output?

1.6 Scope of the Study

The study is to cover the whole aspect of internally generated revenue within the Local Government in Nigeria with a view to generating accurate and timely information regarding the revenue generation within Oyi Local Government council in Anambra State as stated in the importance of the study.

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