TAXATION AS A REFORM TOOL IN NIGERIA’S OIL AND GAS SECTOR: LESSONS FROM THE CANADIAN EXPERIENCE

Abstract

The  oil  and gas  sector  is  Nigeria’s  major  source  of  revenue.  By  virtue  of  this  Nigeria  economy  is  more of a monolithic one. Aside Nigeria’s direct involvement in exploration and exploitation of her mineral resources through the NNPC the revenue majorly come from the various tax regimes in the sector. The taxation in the sector has been undergoing serious challenges and malfunctioning of the system leaves little or nothing to be desired as the effect is as  devastating  as  it  is  cancerous  to  the  Nigerian  economy.  Consequently,  there  are  serious  calls  from  several stakeholders in Nigeria’s oil and gas industry pointing towards the necessity of having petroleum sector reforms, particularly  as  it  regards  the  tax  system.  In  carrying  out  this  research,  the  researcher  employed  the  doctrinal method of research wherein the comparative, descriptive and analytical approaches were adopted. Also the primary sources of legislation, books and judicial authorities as well as secondary sources of journal articles, publications etc were used. It was found out that there are certain industry inefficiencies in the Nigeria’s petroleum sector that has bedeviled the sector. During the research, it was also discovered that Canada being reputed to have one of the best oil and gas regimes in the world has certain tax measures that have considerable potential for addressing those inefficiencies  and  challenges  in  the  sector.  Thus  a  detailed  comparison  was  carried  out  between  Nigeria  and Canada  in  order  to  explore  the  possibility  of  using  Canada  as  a  test  case.  The  researcher  concluded  in  line  as asserted above. Recommendations were made which suits the different phases of the challenges and inefficiencies