A CASE STUDY OF OBAFEMI/OWODE LOCAL GOVERNMENT
DAIRO ISAAC KUNLE
Dept. Of Economics, University of Ibadan
Local governments are potentially very important for Nigeria as they play a significant role in generating revenue and encouraging civil involvement, as well as creating a visible link between taxes and service delivery. The increasing cost of running government coupled with dwindling revenue has left various local governments in Nigeria with formulating strategies to improve the revenue base. Despite the numerous sources of revenue available to the various tiers of government as specified in the Nigeria 1999 constitution, since the 1970s till now, over 80% of the annual revenue of the three tiers of government comes from petroleum. However, the serious decline in the price of oil in recent years has led to a decrease in the funds available for distribution to the states and local governments. The need for state and local governments to generate adequate revenue from internal sources has therefore become a matter of extreme urgency and importance. The need underscores the eagerness on the part of state and local governments and even the federal government to look for new sources of revenue or to become aggressive and innovative in the mode of collecting revenue from existing sources.
STATEMENT OF PROBLEM
The general concern over the seemingly slow development of the rural areas in Nigeria has created a doubt as to the relevance of local governments in Nigeria whose primary function was to effect a representative government faster to all areas of the state land. Inadequacy of funds for various developmental projects stands as the cause for these shortcomings despite the increasing revenue allocation from the Federation accounts to the local governments. Hence the reason for the various avenues granted the local governments to generate...