The Impact of Withholding Tax on Government Revenue Generation in Uyo Local Government Area: A Study of Uyo Local Government Area (2015–2025)
DOI:
https://doi.org/10.67487/tjahs.v2i3.264Keywords:
withholding tax, government revenue, Uyo Local Government Area, administrative challenges, COVID-19 (2020)Abstract
This study examined the impact of withholding tax on government revenue generation in Uyo Local Government Area, Akwa Ibom State, Nigeria, covering the period 2015 to 2025. The broad objective was to assess the trend, relationship, and contribution of withholding tax to overall revenue generation in the study area, alongside the administrative challenges that militate against effective withholding tax administration. The study adopted an ex-post facto and survey research design, drawing on a Taro-Yamane-derived sample of 190 respondents (58 from Uyo Local Government Area and 132 from the Akwa Ibom State Internal Revenue Service), of which 186 questionnaires were returned and used. Findings revealed that withholding tax collection in Uyo Local Government Area was relatively stable between 2015 and 2019, declined sharply in 2020 attributable to the COVID-19 pandemic and the associated oil price shock and recovered gradually through 2025. Withholding tax was found to contribute negligibly (approximately 0.065%) to Uyo Local Government Area's total revenue over the study period. A majority of surveyed staff (64.5%) agreed that withholding tax administration in Uyo L.G.A. faces significant administrative challenges. The study concludes that withholding tax, as currently administered, plays a marginal direct role in the local government area's revenue profile. It recommends improved fiscal data documentation, strengthened monitoring of withholding agents, and a review of revenue-sharing arrangements between state and local government tiers.
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