Background of the Study
Local governments play a pivotal role in grassroots development, yet their capacity to generate adequate revenue remains a recurring challenge in Nigeria. The effectiveness of revenue generation systems directly impacts their ability to deliver essential services such as healthcare, education, and infrastructure (Adeyemi & Babatunde, 2023). Revenue generation in Nigerian local governments involves statutory allocations, internally generated revenue (IGR), and external grants. However, dependence on federal allocations has hindered financial autonomy and growth in these subnational entities.
In Enugu North Local Government Area (LGA), revenue generation systems have historically been fraught with inefficiencies. These include outdated tax assessment methods, lack of digitalization, and resistance from taxpayers due to a lack of transparency (Eze et al., 2024). The rapid urbanization in the region further exacerbates these challenges, as the increased population places additional demands on public services.
Past studies have noted that the inefficiency in revenue systems stems from weak institutional frameworks, inadequate capacity of revenue staff, and corruption (Oluwafemi & Nwankwo, 2025). Furthermore, limited public awareness and participation in local governance reduce the willingness to comply with revenue policies. Addressing these issues is critical for sustainable development in local governments, as effective revenue systems enable them to achieve fiscal sustainability and improve service delivery.
Statement of the Problem
Despite their constitutional mandate to generate revenue, many local governments in Nigeria continue to struggle with inefficiency and underperformance in revenue collection. In Enugu North LGA, these issues have led to poor service delivery, affecting the well-being of residents. Challenges such as inadequate infrastructure, low accountability, and high administrative costs hinder revenue mobilization.
The reliance on federal allocations, which are often unpredictable and insufficient, further complicates matters (Umeh, 2023). Additionally, the lack of modern technology in revenue administration and low public confidence in government institutions exacerbate the revenue challenges in the LGA. While efforts have been made to address these shortcomings, a comprehensive evaluation of the existing revenue systems is lacking. Without this, policies and reforms may fail to address the root causes of inefficiencies.
Objectives of the Study
Research Questions
Research Hypotheses
Scope and Limitations of the Study
The study focuses on evaluating the revenue generation systems in Enugu North LGA, examining both internal and external factors influencing their performance. It will analyze revenue policies, administrative processes, and taxpayer behavior. The study is limited by potential access issues to financial records and the reluctance of stakeholders to provide information.
Definitions of Terms
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