Disparities in Nigeria's PAYE Tax Structure Examined

The article examines the PAYE tax structure in Nigeria, particularly focusing on Lagos State and its comparison with other states such as Abuja and Delta State. It highlights the significant disparities in tax revenue generation, particularly Value Added Tax (VAT), which raises concerns about fiscal arrangements and economic planning.

The current tax system favors residents of states like Lagos, neglecting those from other states, which leads to a lack of equitable development across the country. The article points out that the Nigerian constitution recognizes the dichotomy between state of origin and state of residence, which complicates tax responsibilities.

This arrangement has resulted in a long-standing developmental gap, particularly between Lagos and Abuja compared to the other 35 states. The need for reform in the tax structure is emphasized to ensure fairer contributions and benefits for all states, addressing the socio-economic challenges faced by various regions.