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International Handbook on Clinical Tax Education: Chapter 8 Public education The Tax Club UNILAG

International Handbook on Clinical Tax Education
Chapter 8 Public education The Tax Club UNILAG
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table of contents
  1. Title Page
  2. Copyright
  3. Contents
  4. List of figures
  5. List of tables
  6. List of appendices
  7. List of abbreviations
  8. Foreword
  9. 1. Introduction
  10. Part I. The tax clinic
    1. 2. A brief history of tax clinics around the globe
      1. 2.1 Key findings
      2. 2.2 Introduction
      3. 2.3 From humble beginnings
      4. 2.4 From east to west
      5. 2.5 From south to north
      6. 2.6 Conclusion
    2. 3. Project administration: how to set up a tax clinic
      1. 3.1 Key findings
      2. 3.2 Introduction
      3. 3.3 The foundations of a clinic
        1. Institutional and/or organisational support
        2. Costs and wider resources
        3. Supervision
        4. Insurance
        5. Data protection
      4. 3.4 Clinic design
        1. Student and supervisor recruitment
        2. Educational design
        3. Integration into community (client recruitment)
      5. 3.5 Concluding remarks
      6. 3.6 Key reading
    3. 4. Rationale: tax support for low-income individuals
      1. 4.1 Key findings
      2. 4.2 Introduction
      3. 4.3 Historical context
      4. 4.4 The tax charities – what they really do
        1. TaxAid
        2. Tax Help for Older People
        3. Tax clinics
      5. 4.5 The tax charities moving forward
      6. 4.6 Access to the tax charities
      7. 4.7 A rationale for low-income taxpayer support: common tax issues faced by those on a low income
        1. Non-tax issues
        2. Tax complexity
        3. Expansion of self-employment
        4. COVID-19
        5. Late registration and tax returns
        6. Other changes in how people are paid
        7. Incorrect PAYE codes
        8. Pension drawdown
        9. Proliferation of umbrella companies and disguised remuneration schemes
        10. Penalties
        11. Bankruptcy
        12. Digital exemption and assisted digital
        13. Working with HMRC to resolve generic tax issues
      8. 4.8 An international call to action
      9. 4.9 Concluding remarks
    4. 5. Rationale: tax and the poverty interface
      1. 5.1 Key findings
      2. 5.2 Introduction
      3. 5.3 Canvassing the tax and wider social issues addressed by the National Tax Clinic Program
        1. Tax and financial literacy
        2. The unmet need for tax advice in Australia
      4. 5.4 Introducing the UNSW Tax and Business Advisory Clinic
      5. 5.5 Benefit of tax clinics: Australia and internationally
        1. Opportunities for further research
      6. 5.6 Concluding remarks
  11. Part II. Tax clinics and our communities
    1. 6. Engagement in the community
      1. 6.1 Key findings
      2. 6.2 Introduction
      3. 6.3 The external stakeholders in CTE
        1. Supporting your local community
        2. Becoming part of the local community
      4. 6.4 Concluding remarks
    2. 7. Listening to our communities: the Community Tax Law Project as an example of a low-income taxpayer community-focused service provider
      1. 7.1 Key findings
      2. 7.2 Introduction
      3. 7.3 What does a community-focused tax clinic look like?
        1. Mission driven
        2. Community understanding and support
      4. 7.4 What populations are you going to serve?
        1. Demographic scope: how do your clients live, work, pray or play?
        2. Resources and limitations
        3. Learn from failures
      5. 7.4 What do these populations need or want?
      6. 7.5 What specifically does your clinic require to meet these needs and wants?
        1. Community partners: you cannot reach everyone by yourself
        2. Social capital: the who, what and when of building your clinic family
        3. Finances: the lights do not stay on with positive thoughts and well wishes
      7. 7.6 How do I fix the problem at the source? Yelling up the chain: advocacy as part of the clinic’s mission?
        1. Community advocacy
        2. Administrative advocacy
        3. Litigation as a venue for change
        4. Governmental advocacy
      8. 7.7 Conclusion
    3. 8. Public education: the Tax Club UNILAG
      1. 8.1 Key findings
      2. 8.2 The context of the Tax Club UNILAG
      3. 8.3 The creation of Tax Club UNILAG
      4. 8.4 An overview of the club’s activities
      5. 8.5 The importance of tax clubs
      6. 8.6 Some challenges faced by the tax club
      7. 8.7 Support for the use of tax clubs in education
      8. 8.8 Looking to the future
      9. 8.9 Concluding remarks
    4. 9. Public education: engaging with secondary education in schools
      1. 9.1 Key findings
      2. 9.2 Introduction
      3. 9.3 Tax clinics as defenders of taxpayer rights
      4. 9.4 Partnering with secondary education
        1. How the partnership was established
        2. Benefits of the community partnership
      5. 9.5 Conclusion
    5. 10. Taxpayer resolution: improving taxpayer compliance in Indonesia
      1. 10.1 Key findings
      2. 10.2 Introduction
      3. 10.3 Taxation in Indonesia in a nutshell
        1. Registration
        2. Bookkeeping
        3. Payment
        4. Reporting
        5. Audits and penalties
      4. 10.4 Revenue and taxpayer compliance
      5. 10.5 Improving individual taxpayer compliance
        1. The formation of the FoT community
        2. The development of FoT
      6. 10.6 Conclusion
    6. 11. Policy changes: impact on and through the Tax Court
      1. 11.1 Key findings
      2. 11.2 Introduction
      3. 11.3 Government approach
        1. Regulations and other rules
      4. 11.4 Role of tax clinics in shaping the law
        1. Litigation: impact of clinics on the community of low-income taxpayers
        2. Commenting on proposed legislation, regulations, forms and rules
        3. Commenting on systemic problems at the IRS
      5. 11.5 Conclusion
    7. 12. Marginalised voices: tax and the criminal justice system
      1. 12.1 Key findings
      2. 12.2 Introduction
      3. 12.3 Making Tax Digital
      4. 12.4 Digital exclusion
      5. 12.5 Tax issues – people in prison
        1. Digital exclusion – people in prison
        2. People in prison/with previous lived experience of prison as clinic clients
        3. Prison and self-employment
        4. Tax and self-employment
      6. 12.6 Student and university benefits
      7. 12.7 Conclusion
  12. Part III. Tax clinics and our students
    1. 13. Pedagogical theory and clinical tax education
      1. 13.1 Key findings
      2. 13.2 Introduction
      3. 13.3 Fostering the next generation of tax advisers: the importance of pro bono
      4. 13.4 Relevant pedagogical theories
        1. Employability from tax clinics: work-integrated learning (WIL)
        2. Growing student motivation and confidence: self-determination theory (SDT)
      5. 13.5 Concluding remarks
      6. 13.6 Key reading
    2. 14. Enhancing student experience: shadowing, role-plays and reflection
      1. 14.1 Key findings
      2. 14.2 Introduction: pedagogical rationale
      3. 14.3 Initial collaboration
      4. 14.4 Implementation
        1. Student recruitment
        2. EOI, CV and job interview
        3. Participation and presentation
      5. 14.5 From theory to practice
        1. Shadowing
        2. Team-based approach
        3. Role-plays
        4. Reflection and report writing
        5. Career readiness
        6. COVID-19 and the impact on the student experience
      6. 14.6 Conclusion
    3. 15. Introducing tax advocacy to students
      1. 15.1 Key findings
      2. 15.2 Introduction
      3. 15.3 The structure of a clinic course
        1. The seminar component
        2. The client representation component
      4. 15.4 Major design choices within the clinic model
        1. The directive–nondirective continuum
        2. Level of student responsibility for cases
        3. Use of examples and templates
        4. Case supervision
        5. Tension between client service and student educational development
      5. 15.5 Developing a reflective practice
        1. Exercising agency over one’s professional development
        2. Building the habit of reflection
      6. 15.6 Skills and direct advocacy experience
        1. Law firm management
        2. Ethics
        3. Multicultural lawyering
        4. Legal skills
          1. 1. Interviewing
          2. 2. Fact and legal investigation
          3. 3. Client advice and communication
          4. 4. Document drafting
        5. The advocacy mind-set
      7. 15.7 Working with community members
      8. 15.8 Conclusion
    4. 16. Developing employability skills through practice-based learning
      1. 16.1 Key findings
      2. 16.2 Introduction
      3. 16.3 Rationale for the TAC at UEL
        1. To raise awareness and provide free guidance in response to the COVID-19 lockdown
        2. To support employability of our accounting and finance students
      4. 16.4 Relevant literature
        1. Voluntary services: student, faculty and practitioner participation
        2. Pro bono: the participation of experienced practitioners
      5. 16.5 Clinic design
        1. Student volunteers
        2. Practice-led teaching
        3. External impact, collaborations and partnerships
        4. Student experience
        5. The challenges of tax and accounting clinics
      6. 16.6 Data and methodology
      7. 16.7 Results and discussion
        1. Tax and accountancy clinic and employability skills development
        2. The impact of COVID-19 on student TAC experience
        3. The measurement of students’ satisfaction: quality of the TAC training
      8. 16.8 Concluding remarks
    5. 17. Students’ professional identity and a fully online tax clinic
      1. 17.1 Key findings
      2. 17.2 Introduction
      3. 17.3 The Griffith Tax Clinic
        1. Face-to-face
        2. Online
      4. 17.4 Research methodology
        1. Participants
      5. 17.5 Data results
        1. Overall
        2. Nationality
        3. PWE (Professional Work Experience)
        4. Limitations of research and future research
      6. 17.6 Concluding remarks
  13. Part IV. Moving forwards
    1. 18. A research roadmap for tax clinics
      1. 18.1 Key findings
      2. 18.2 Introduction
      3. 18.3 Developing the tax clinic as a research project
      4. 18.4 Mapping the research field
      5. 18.5 Research methods
      6. 18.6 Theoretical perspectives
      7. 18.7 Concluding remarks
    2. 19. Moving forwards: tax clinics and business schools
      1. 19.1 Key findings
      2. 19.2 Introduction: the civic university
      3. 19.3 Widening participation
      4. 19.4 The challenge of professional accreditation
      5. 19.5 Practical experience
      6. 19.6 Some ideas for clinics going forwards
        1. Replacing High Volume Agents (HVAs)
        2. Child Trust Funds
        3. Cryptocurrencies
      7. 19.7 Policy clinics
        1. Desk research for the Office of Tax Simplification
        2. Educating policy makers
        3. Drawing on students’ experiences of the tax system
      8. 22.8 Concluding remarks
    3. 20. Concluding remarks
  14. Index

Chapter 8 Public education The Tax Club UNILAG

Edidiong Bassey and Aduloju Oluwatofunmi*

8.1 Key findings

Tax education is critical to voluntary tax compliance. In Nigeria, a recurring problem has been its low level of tax compliance as evidenced by its tax-to-GDP ratio of 6 per cent below the International Monetary Fund (IMF) recommendation of 15 per cent. Tax education is seen as a possible route, among others, to address this. Any form of tax education in Nigeria is grossly inadequate if younger people are not centre stage, not just because instilling a sense of civic duty is easier at a younger age but because more than 60 per cent of Nigeria’s population is currently under the age of twenty-four.

Against this backdrop, a tax club at the University of Lagos was developed with three goals: 1) to increase youth tax literacy; 2) to educate the wider public about tax using a range of initiatives; and 3) to provide networking opportunities for members with individuals from the private and public spheres. This tax club has had some successes, notably the establishment of dozens of other tax clubs in universities all across the country and even partnerships with secondary schools, the development of innovative approaches to increase youth tax literacy, partnerships with various public and private institutions and more coverage of tax matters by the press.

8.2 The context of the Tax Club UNILAG

A number of major challenges besieges the Nigerian tax environment, like many other developing countries. It has a large informal sector that doesn’t pay taxes,1 fiscal policies centred almost exclusively around natural resources as its source of income,2 a low tax-to-GDP ratio and low tax morale driven by, among other things, perceived grievances about the breach of the social contract by the government.3

Indeed, previous research has demonstrated the importance of tax education as one of three strands to improving tax compliance in such countries.4 This is because tax education has the potential of empowering citizens as they know more about their rights and obligations. It is important that tax education not only builds morale but educates citizens about the kind of taxes they should pay. According to an academic survey,5 62 per cent of African citizens did not know what taxes they needed to pay. The link between low tax education and a higher likelihood of tax evasion has been reaffirmed in further studies in the Nigerian context.6

The Nigerian government is also cognisant of this fact, thus, with a view to widening the tax base, the Nigerian government have devoted time and resources to the advancement of tax education. For example, in February 2022, the Federal Inland Revenue Service (FIRS) signed a memorandum of understanding with telecommunication agencies such as the Nigeria Television Authority to create awareness nationwide on the importance of tax.7 However, as the Organisation for Economic Co-operation and Development (OECD) report on tax education suggests, tax education should not only be a governmental priority, but also that nongovernmental actors have a role to play in tax education. In countries like Nigeria where trust in government is low, such actors may achieve more success as they may have a better reach or less animosity from the target population.8

Within this space, the tax club represents one of the numerous innovations or platforms used for the advancement of tax education. The tax club is an association dedicated to the development of taxation, by improving youth tax literacy as well as empowering such youths to educate their wider population. Given the importance of tax education to tax compliance, the tax club plays a role in shaping the mentality and approach of the public towards taxation, particularly the younger generation, which constitutes around 60 per cent of the population9. It is then arguable that tax clubs perform a societal function as they shape the minds of young citizens to have a positive approach to taxation.

The concept of a tax club is not peculiar to Nigeria as tax clubs are an age-long structure within the tax space, existing as far back as the Texas Tax Club Movement (1924–1925) and the Chicago Tax Club.10 Today, we have tax clubs all over the world; some exist as independent clubs in society while others exist with the traditional educational structures. In Nigeria, tax clubs exist largely within the traditional educational structures such as universities and other higher institutions. Students manage them – although they enjoy the guidance and mentorship of tax professionals who are either lecturers of taxation or tax practitioners: tax clubs are therefore innovative, nontraditional learning environments.

The first Nigerian tax club, based in the Faculty of Law at the University of Lagos, was formed by a group of forward-thinking individuals who saw the need to advance the tax education agenda to the younger generation (Tax Club UNILAG). Its membership cuts across law students, students of accounting, economics and other faculties in the university with a genuine interest in the field of taxation. The Tax Club UNILAG was created by tax students, who saw the low level of tax instruction in the curriculum as one of the impediments to voluntary tax compliance in the country,11 transforming the idea of what was a mere tutorial group for tax law students into a full-blown club, with the support of Professor Abiola Sanni (SAN).

Several years down the line, the tax club has, directly and indirectly, led to the formation of similar club structures across a sizeable number of universities in Nigeria. It remains the foremost student-managed tax group in Nigeria. This chapter seeks to provide the detailed background behind the formation of the tax club and to use the tax club as a point of reference to provide an exposition into the role of tax clubs in the advancement of tax education in Nigeria.

8.3 The creation of Tax Club UNILAG

The Tax Club UNILAG was formed in 2006 with the aim of deepening understanding of tax, propagating the concept of tax, and providing an opportunity to network with industry practitioners. In essence, it could serve as a means for students with an interest in tax to build upon that interest and prepare for a career in the field. The founding members of the club considered various names, such as the Tax Awareness Forum UNILAG, before settling on simply the ‘the Tax Club’.

The club was formed in the 2005/6 academic session with twenty members and a vision to increase tax education, particularly among youths. Initially, it faced problems of apathy, lack of publicity and logistics. However, the club was able to find its footing by leveraging the support of various corporate organisations, the professional body of tax advisers, the Chartered Institute of Taxation, Nigeria (CITN) and a subnational tax authority, the Lagos State Internal Revenue Service (LIRS). This is in large part due to the strong support given to its founders, by Professor Sanni. Through this network, members were able to organise seminars and invite reputable tax experts, provide internships for members in the taxation industry, and send representatives to taxation conferences.

An important part of the club’s history is that it was the first student association within the Faculty of Law, University of Lagos, outside of chambers. This meant that substantial effort had to be put into convincing individuals of the benefits of the club within the faculty. Some challenges were unique at the time, due to the novelty of a student organisation within the faculty.

8.4 An overview of the club’s activities

There follow a number of programmes that are often employed by the tax club for the advancement of their aim and objectives. These activities provide an insight into what a tax club can achieve, as well as to provide inspiration to others.

Monday Memo: the Monday memo represents a piece of tax information that is shared weekly to educate people on happenings in the tax world. Usually short, it takes the form of ‘did you know’ that then gives information on the state or provisions of a certain development in taxation.

Tax Thursday: The Tax Thursday is a social media campaign which happens every Thursday where members of the club talk about tax issues online, particularly on Twitter.12 With the tweets and retweets using the hashtag Tax Thursday, members of the public discuss prevailing tax issues. In 2017, the effort of the tax club received recognition when the Nigerian Vice President publicly endorsed the Tax Thursday campaign.13

Tax Club Journal: Titled the Tax Anthology, the journal of the tax club represents the club’s well-researched contribution to tax knowledge. It features contributions from various experts in the tax field and covers policy evaluation, policy review, field research, case reviews and, sometimes, reviews of existing tax literature.

Blog Post: In-depth insight and explanations on topics related to tax are shared on the Club’s blog. This can range from hot topics in the world of taxation to explanations of basic concepts. The blog also helps to stay up to date on the latest happenings. The blog features contributions from members of the club and the university community in general.

National Tax Debate: The National Tax Debate is an annual event where representatives of different schools compete with words on one stage. With about twenty universities taking part, the National Tax Debate is one of the biggest tax competitions in tertiary institutions in the country. The multistage competition begins with an essay qualification stage, where schools are expected to submit entries that serve as the basis of qualification to take part in the actual debating competition. The twenty universities that participate in the National Tax Debate enter a team of four members, excluding researchers, and student coaches. Participants also have the opportunity to make recommendations that may be submitted to policymakers.

At the National Tax Debate 6.0 (October 2021), the final round of the debate was a blueprint presentation aimed at proposing a lasting solution to the challenges associated with the effective administration of value added tax (VAT) in Nigeria. The Winning Team, Team H (The University of Lagos), had its policy recommendation forwarded to: the National Tax Policy Implementation Committee, the Nigerian Economic Summit Group, the National Economic Council, the Federal Ministry of Finance, the Senate President, and the Speaker of the House of Representatives. This allowed the students to influence and guide policy formation and implementation.

Professor Abiola Sanni (SAN) Essay Competition: This is an essay competition named after the founder of tax clubs in Nigeria that rewards participants for their writing prowess and knowledge of taxation. The winner receives a cash prize and is published in the tax journal, among other awards. The award ceremony takes place on the last day of the National Tax Debate.

Tax walk: This is an event during which members of the tax club embark on a public enlightenment walk to educate people on the importance of paying taxes. It serves as an informal way of getting through to people who do not have access to print media.

Tax Masterclass: Leading practitioners of taxation are invited to teach students the intricacies of tax. The programme is open to members and non-members of the tax club and provides them with an opportunity for certification.

Tea and Taxes: Tea and Taxes is a breakfast meeting of tax practitioners, lawyers, policymakers, administrators and members of the club. It presents a unique networking opportunity for members of the club.

Youth Tax Summit: The Youth Tax Summit is a national summit open to young people all over the country. It presents an opportunity for those individuals to evaluate different tax policy issues, ask questions and debate potential solutions. The last edition of the Youth Tax summit was in 2017 and took the place of the traditional National Tax Debate.

The Tax Experience: The tax experience is quite similar to the traditional excursion, however in this case, it is a work visit to selected firms to have a firsthand experience of the workspace and workings of tax practitioners, right there on the field. The last edition of the tax experience was in 2017, during which members visited the ‘Big 4’ accounting firms and Dangote Nigerian Ltd.

8.5 The importance of tax clubs

Studies suggest that the low level of tax education in Nigeria may play a stronger role than deterrence as a leading cause of the low level of tax compliance in the country.14 According to a survey conducted by the Nigeria Economic Support Group, only 12 per cent of participants received information from the government about taxation. This low rate shows that information to help educate people about tax is not being efficiently disseminated.15 In light of this, it is very important to bridge the knowledge gap as it relates to taxation.

Research has been carried out on how an increased understanding of tax laws, policies and regulations can increase the tax compliance rate among citizens. In their research ‘The Challenges Affecting Tax Collection in Nigerian Informal Economy: Case Study of Anambra State’,16 the authors identified how a low level of tax education plays a significant role in the low level of tax compliance in the informal sector, which constitutes a huge source of tax revenue. This, therefore, leads to an increased level of tax evasion. The Tax Club UNILAG, therefore, provides an important societal function through its grassroot education and tax awareness schemes for its critical audience, the university students and the wider public.

This is done through various innovative programmes within the immediate university community and the society at large. Owing to its numerous activities, the tax club has shown itself to be a very important partner in the drive toward tax education. Below are some of the numerous benefits of the different activities of the club:

•   Taxation can often be seen as an unexciting topic and there has been an acknowledgement in the literature of the need to deploy innovative mechanisms to improve students’ interest.17 The members of the tax club achieve this through various innovative and entertaining activities to drive home the knowledge of taxation among the students, including innovative games that raise awareness on tax issues, conducting mini tax competitions and pop quizzes, which incite the increased interest in taxation in the students.

•   Curricula can often be old and out of date, especially in the world of taxation where tax laws are updated regularly.18 The tax club helps provide a more up-to-date perspective, through its journal publication, Tax Anthology. Contributions from reputable minds in taxation from academia, practice and government over the last five years have helped students to be fully informed.

•   The club takes its public tax education responsibilities seriously and aims to stir up conversation on salient and trending tax issues with the public. This is done largely through the Tax Memo. This memo saw increased participation online especially through the pandemic, as this was an avenue to educate the public in real-time and close the knowledge gap. This has thus ensured that the club takes awareness of taxation beyond the physical gathering and also leverages technology and its expansive possibilities to increase tax education. Engagements on these short updates have indicated that there is a bridge in the knowledge gap that is existent. The Tax Memo has an estimated reach of over 5,000 people. This includes our members and our followers on various social media platforms.19

•   In addition to its online efforts, to advance public tax education, the tax club through its tax walk reaches out to those who are harder to access by the governments’ traditional tax education activities in rural communities and informal settlements. Members of the club try to break down the fundamentals of taxation for these groups in a more simplified manner, in the bid to pass on the knowledge of taxation while equally garnering interest in tax compliance. The club has taken this activity to various ‘hard to tax’ markets in Lagos, Nigeria, such as the Yaba Market, the Alade market and the community of Adeniran Ogunsanya. This is usually done with collaboration from tax authorities such as the LIRS and the FIRS. With this activity, the tax club gets to increase tax awareness in the informal sector by passing across the knowledge on how taxes are used, how important taxes are and how to calculate taxes when necessary. The tax walk also presents members of the club with an opportunity for firsthand interaction with taxpayers and tax administrators.

•   Tax education leads to empowered citizens but that also means citizens can critique the weaknesses or inadequacies of current laws and make recommendations for reforms. This can be evidenced through its active contribution to the public consultation sessions organised by the Ministry of Finance for upcoming Finance Acts. However, this is best demonstrated through its Tax Debate, its signature event. This event is well attended by members of the university community and the general public, with participants consisting of students from various tertiary institutions across the country, with the sole aim of debating a series of well-curated tax-related topics, which leads up to the grand debate of the event where two of the excellent universities face each other head-on in addressing very salient topics within the scope of taxation. The event is not just restricted to the debate, as often the tax club hosts a wide range of industry experts who also educate the university community and the society at large on taxation.

Through these activities, the tax club is helping to close the knowledge gap that exists in both the educational system and the society at large.

8.6 Some challenges faced by the tax club

Challenges faced by the tax club include the limited participation of non-tax students,20 the difficulty in fostering interest in taxation, limited tax knowledge and bureaucracy. Each of these challenges can critically impede the progress of the Tax Club UNILAG, and its ability to achieve its goals and objectives, so extensive steps have been taken to combat them. These challenges are not jurisdictionally limited to the Tax Club UNILAG. As such, the challenges are outlined below to help readers design and plan any tax club activities that they may wish to introduce in their own institutions or organisations.

The limited participation of non-law students in the activities of the Tax Club UNILAG impedes its objectives. This should not be the case as taxation involves more than the legal discipline: accounting students and students of other relevant disciplines, such as economics, history and public policy, all have something to bring to taxation. The Tax Club UNILAG has made an effort to be inclusive. It considers the various disciplines that make up the taxation industry and seeks to achieve a blend of individuals from these various industries. Traditionally, the Tax Club UNILAG is dominated by law students, primarily because the club is situated in the Faculty of Law. Consequently, non-law students often limit their participation in the activities of the club. The tax club has been carrying out awareness programmes to attract students in other faculties, letting them know that it is important that everyone understands how the tax system works. In addition, during the course of admission of new members, priority is given to having more non-law student members.

Another challenge faced by the club is the difficulty of fostering interest in taxation in students. Many law students do not take taxation law as a course until their penultimate or final years of study. Even then, it is often an elective course, only taken by some students. Therefore, the Tax Club UNILAG is required to take on the responsibility of fostering an interest in taxation in students. If the club fails to do this and waits for the students to naturally choose the course as an elective, there would be little time for the students to contribute meaningfully to the club. On the other hand, while the Tax Club UNILAG tries to foster interest, taxation law often remains an elusive and abstract topic for many students. This is why the club has tried to be very creative and practical in its approach to tax education and enlightenment, as can be seen from its numerous activities over the years.

The limited tax knowledge is also a challenge for the Tax Club UNILAG. Despite the best efforts of the members of the executive of the Tax Club UNILAG, the fact remains that members of the tax club are students. Therefore, they often have no practical experience. At best, what they have is extensive knowledge of the theoretical aspect of taxation. This poses a problem, as the members of the tax club ought to be highly knowledgeable and well versed in tax matters if they are to serve as advocates of taxation in a very short time frame.

University bureaucracy and administration is another challenge that the Tax Club UNILAG faces. This is something that is likely to impact any institution looking to hold such a club. It is important for staff working in a tax club to be aware of any administrative requirements needed to set up a club: as the Tax Club UNILAG is resident in the university community, it often has to deal with administrative bureaucracy, especially when dealing with the much larger university management. This requires time management, patience and organisation.

There are also challenges faced by the Tax Club UNILAG in their relations with the wider public. These challenges affect the ability of the tax club to carry out programmes and communicate with the general populace. These challenges include low tax compliance, the low level of interest in taxation in the population, the change of executive heads of the tax agencies, a lack of collaboration between the different tax clubs, and the poor security of Nigeria.

There is a low compliance and interest in the tax system among Nigerians. The National Bureau of Statistics recently reported that only 13 per cent of the workforce is in the tax net, despite a labour force of 77 million people at the end of 2015.21 Out of this, only roughly ten million people are registered for personal income tax purposes, according to estimates by the Joint Tax Board. Lagos alone accounts for about 4.6 million people (46 per cent), while other states have an average of 153,000 people (1.5 per cent).22 The finance minister was recently quoted as saying that the VAT compliance rate is around 12 per cent.23 The situation for corporate income tax is not much better. Prior to the recent increase in corporate tax registration, the former finance minister claimed that 75 per cent of registered companies were not in the tax net and that 65 per cent of those who were in the tax net did not file returns or pay taxes. This equates to less than 9 per cent of all companies operating in Nigeria.24

Taxes are seen as a wrongful act; something that takes away income from individuals. This is particularly so as the people do not see the spending effects of the taxes around them. Therefore, members of the public often become suspicious when they observe the Tax Club UNILAG carry out its activities. They believe that such actions are financially motivated and would be to their detriment. Members are often asked directly ‘who paid you to do this’ and ‘how much were you paid’. People liable to pay taxes also do not see how the payment of these taxes would correlate to a benefit for them,25 and often consider the members of the club who advocate for a better tax payment culture as puppets of the government.

The change of the executive heads of the tax agencies can also affect tax clubs. Tax clubs, including the Tax Club UNILAG, will often go through considerable efforts to build relationships with various tax authorities. This takes time and effort, especially in developing trust and goodwill with the tax authorities and executive heads. However, where there is no proper transition process and heads of agencies are suddenly changed, it can affect the relationship with the agency as a whole. New occupants may choose a new approach and abandon the projects of old occupants. Therefore, it becomes necessary to build the relationship once more. Thankfully, this has not been the case for the Tax Club UNILAG so far. This is thanks to the leadership of agencies, such as the LIRS and FIRS, who understand the importance of tax education, and recognise that the much-needed gains of effective tax education cannot be realised without their support, which is instrumental to the success of the different activities of the club.

There is also the issue of a lack of collaboration between the various tax clubs, all over the country, and this is a major challenge for the tax club system in Nigeria. Working together across several states and the various geo-political zones has proven difficult with the reputation of one tax club affecting that of other tax clubs. The Tax Club UNILAG has been stuck in situations where members of the club travelled across several states only to be left waiting by hosts of tax clubs in other schools. There are also issues of poor transparency which do not augur well for the relationships between tax clubs across various schools. It is therefore important for tax clubs to come together to achieve their goals and objectives; the primary one being to advance the knowledge and practice of tax among youth in Nigeria and by extension the wider population. This could be achieved by having a network of tax clubs in a jurisdiction.

Finally, the tax club needs to consider the security of its members; for instance, the ability of its members to move around the country effectively to further its activities. This was most recently observed in the annual tax quiz by the Chartered Institute of Taxation, Nigeria (CITN). The competition was to take place in Kaduna State, and due to the recent security situation in the state, the representative of the club had to pull out at the last minute. The geopolitical backdrop of a country can significantly affect the work that can be done by a tax club.

This represents an extensive rundown of the numerous challenges faced by the Tax Club UNILAG; however, the club believes that these challenges are not insurmountable.

8.7 Support for the use of tax clubs in education

As discussed in Chapter 7 in relation to tax clinics, tax education, enlightenment and advocacy require financing, mentorship, guidance, and different levels and layers of support. To achieve its aims, the Tax Club UNILAG requires as much support as possible, and fortunately, the club has been largely blessed in this regard, being the recipient of both institutional support and private support.

For the institutional support, this is where the tax agencies and law firms that specialise in taxation can play a role. This includes companies and organisations who have taken the support of the tax club as part of their corporate social responsibilities. From these institutions, the tax club enjoys support ranging from finances to mentorship, internships, training and capacity building. The Tax Club UNILAG considers institutional support as necessary to effectively achieve its goals and objectives, especially given the multiple challenges faced by the tax club.

For institutional support, the tax agencies such as the FIRS, LIRS, and the Chartered Institute of Taxation (CITN) also play a role. These institutions help to conduct training and organise awareness programmes and competitions that help increase the interest and knowledge of taxation among the students. They can also guide the tax club to achieve its goals and objectives. These institutions also provide internship opportunities to members of the tax club to gain practical experiences. This helps increase knowledge and interest in taxation and the tax club and so helps improve the tax culture among Nigerians at large. These institutions also provide financial support to the tax club to carry out their major programmes such as the National Tax Debate that the Tax Club UNILAG organises annually. The FIRS Chairman, Mr Muhammad Nami, attended the National Tax Debate 6.0 organised by the Tax Club UNILAG. He demonstrated his support further by granting cash prizes to all four finalists in the competition.

Another layer of institutional support can be seen with the ‘Big 4’ accounting firms, consisting of Ernst and Young, KPMG, PWC and Deloitte. These institutions help conduct training and work in collaboration with the Tax Club UNILAG to promote the tax culture in Nigeria. These institutions also allow members of the club to intern at their organisations. They also provide mentorship and guidance for the club and its members.

Law firms and accounting firms also provide institutional support, particularly law firms that are already known for their expertise in taxation. These firms conduct training and master classes geared towards increasing the interest in taxation among the students. And they also take in students as interns to gain exposure to the taxation industry. These law firms help by contributing to the Tax Anthology, providing individuals to serve as judges in the various competitions organised by the club.

Aside from the institutional support, another huge support base for the club features private individuals. Some individuals are committed to tax education in Nigeria. They help with the provision of funds, to ensure that the Tax Club UNILAG achieves its goals and objectives, capacity building, training and seminars. They also help sponsor events and training programmes that help increase the interest in taxation among the students and promote the tax culture in Nigeria.

There is a need for a long-lasting relationship between the private sector and institutions to support the activities of the tax clubs. The tax club should be seen as an avenue through which these institutions can help improve taxpayer understanding and improve the tax culture in a country. These institutions should also be interested in investing in tax clubs to build the capacity of students, which will improve the calibre of students entering the tax profession. All of these things have a positive impact on the Nigerian economy.

8.8 Looking to the future

There are now over thirty tax clubs across different states and universities in Nigeria, all inspired by the initial work of the Tax Club UNILAG and the leadership of Professor Sanni, who has constantly devoted time and effort toward the expansion of tax clubs in Nigeria. The aim is to have a tax club in every tertiary institution in Nigeria.

Another thing the Tax Club UNILAG seeks to achieve (and by extension the other tax clubs in Nigeria) is the expansion of the club membership base beyond the faculties of law, business administration and management science. As of today, across all tax clubs, these faculties house many of the club members.

Beyond internal and external expansion, the tax club also aims to expand in terms of collaboration. At the last count, the club had a solid relationship with the federal and host state tax authority and other key stakeholders within the public and private sectors. However, in recognition of the club’s potential, the club seeks even further collaboration.

While the club has been in talks with the Ministry of Finance, Budget, and National Planning, in the build-up to the 2019 and 2020 Finance Act, by being a part of the stakeholder and public engagement sessions, the club aims to develop its position and reputation in tax. The aim is to position the club to serve as a think tank for the formation of progressive fiscal policies and serve as a machinery for the implementation of such policies. The club also seeks further collaboration with the Ministry of Education to gradually bring tax education to the national curriculum and ensure the sustenance of tax clubs all over our educational institutions.

Beyond national borders, the club aims to engage with the international community, such as: the Tax Justice Network, OECD, the African development bank, the African Continental Free Trade Area Secretariat, and the World Trade Organization (WTO). This will allow the club to include the voices of young people in Nigeria on global issues like transfer pricing, Base Erosion and Profit Shifting, and the taxation of the digital economy, for example.

8.9 Concluding remarks

A country with 60 per cent of its population under the age of twenty-four needs to focus on improving the tax literacy of its youth, especially with a majority of the entire population demonstrating little knowledge of tax. This is critical as part of an arsenal of tools available to turn around Nigeria’s low tax-to-GDP ratio, especially with evidence suggesting a link between higher tax knowledge and tax compliance.

Taxation can often be seen as an unexciting area and generally, people tend to stay away from tax issues unless they have to, but incorporating innovative tax education activities in the younger population before they become full-fledged taxpaying citizens could go a long way to improving tax morale. If African countries like Namibia, Lesotho and Djibouti can boast of a tax-to-GDP ratio of over 30 per cent, then why can’t Nigeria? This is a journey, and effective tax education of its citizens is a part of it.

This chapter also provides inspiration for those considering a tax club beyond Nigeria. The Tax Club UNILAG has engaged in a wide range of tax activities to promote tax understanding and embed a culture of tax within local communities.

  1. *   Edidiong Bassey, Post-Doctoral Researcher, University of Galway; Oluwatofunmi Aduloju, Associate, Law Forte.

  2. 1   Sixty-five per cent of Nigeria’s GDP is from the informal sector: Nnabuife Ezimma K., Okoli Ifeanyi E. Nuel and Anugwu Clara Chika, ‘Informal Sector and Nigerian Economic Prospects: The Covid–19 Experience’, European Journal of Business and Management Research 5, no. 4 (2020): 1.

  3. 2   Sarah Burns and Olly Owen, ‘Nigeria: No Longer an Oil State?’ (Oxford Martin School Working Paper 2019) <www.oxfordmartin.ox.ac.uk/downloads/academic/Nigeria_Oil_WP_final_130819.pdf> accessed 15 June 2022.

  4. 3   Ibid.; Neil McCulloch, Tom Moerenhout and Joonseok Yang, ‘Building a Social Contract? Understanding Tax Morale in Nigeria’, The Journal of Developmental Studies 57 (2021): 226.

  5. 4   Giulia Mascagni and Fabrizio Santoro, ‘What Is the Role of Taxpayer Education in Africa?’ (ICTD African Tax Administration Paper, 2018), <www.ictd.ac/publication/what-is-the-role-of-taxpayer-education-in-africa/> accessed 5 August 2022.

  6. 5   Rose Aiko and Carolyn Logan, ‘Africa’s Willing Taxpayers Thwarted by Opaque Tax Systems, Corruption: Policy Paper 7’ (Afrobarometer, 2014) <www.afrobarometer.org/wp-content/uploads/migrated/files/publications/Briefing%20paper/ab_r5_policypaperno7.pdf> accessed 5 August 2022.

  7. 6   Peter Okoeguale Ibadin and Embele Kemebradikemor, ‘Tax Fraud in Nigeria: A Review of Causal Factors’, Journal of Taxation and Economic Development 19, no. 1 (2020): 64.

  8. 7   Busola Aro, ‘FIRS Signs MOU with NTA, FRCN to Commence Nationwide Tax Education’ (The Cable, 8 February 2022), <www.thecable.ng/firs-signs-mou-with-nta-frcn-to-commence-nationwide-tax-education> accessed 26 May 2022.

  9. 8   OECD, Building Tax Culture, Compliance and Citizenship: A Global Source Book on Taxpayer Education (Second Edition, OECD Publishing 2021).

  10. 9   Jamie Anderson et al. ‘National Survey and Segmentation of Smallholder Households in Nigeria’ (CGAP, 2017), <https://microdata.worldbank.org/index.php/catalog/2922/download/40974> accessed 6 June 2022.

  11. 10   Isaac William Martin, ‘The Social Origins of The Texas Tax Club Movement, 1924–1925’, Journal of Policy History 25 (2013): 404; The Chicago Tax Club, organised in 1933, is a nonprofit association consisting of individual tax professionals employed by corporations and other businesses. The principal function of our organisation is providing educational and networking events, in order to assist members in identifying and resolving tax compliance, planning and audit issues relating to their employers.

  12. 11   The need for more tax instruction in the wider curriculum of universities to boost tax compliance has been extensively discussed, notably: Bojuwon Mustapha et al., ‘Need Analysis of Tax Education for Non-Accounting Program: Evidence from Nigerian Universities’, International Business Education Journal 14, no. 2 (2021): 61.

  13. 12   The tax club’s social media presence has diminished considerably since 2021.

  14. 13   Ifeoluwa Adeyemo, ‘Tax Thursday: Nigerian Govt. Unveils Campaign in Abuja Streets’ (Premium Times Nigeria, 6 July 2017), <www.premiumtimesng.com/business/business-news/236047-tax-thursday-nigerian-govt-unveils-campaign-abuja-streets.html> accessed 29 May 2022.

  15. 14   Oladipupo, Adesina Olugoke and Uyioghosa Obazee, ‘Tax Knowledge, Penalties and Tax Compliance in Small and Medium Scale Enterprises in Nigeria’, iBusiness 8, no. 1 (2016): 1; see also Ezimma K., Nuel and Chika, ‘Informal Sector and Nigerian Economic Prospects’; Burns and Owen, ‘Nigeria’; McCulloch, Moerenhout and Yang, ‘Building a Social Contract?’

  16. 15   Paul Jegede, ‘Why Is Tax Collection Low in Nigeria’ (The Republic, 14 December 2020), <https://republic.com.ng/december-20-january-21/why-is-tax-collection-low-nigeria/> accessed 26 May 2022

  17. 16   Nobert Osemeke, David Nzekwu and Robert O. Okere, ‘The Challenges Affecting Tax Collection in Nigerian Informal Economy: Case Study of Anambra State’, Journal of Accounting and Taxation 12, no. 2 (2020): 61.

  18. 17   Barbara Apostolou and others, ‘Accounting Education Literature Review (2010–2012)’, Journal of Accounting Education 31 (2013): 107.

  19. 18   Jirinwayo Jude Odinkonigbo, ‘Constitutional Impediments to the Effective Review of Tax Cases in Nigeria by a Specialized Tax Court: Lessons from the United States and Canada’, Journal of African Law 65 (2020): 111.

  20. 19   Over 1,500 members, which includes the club alumni; and over 3,000 Twitter followers, over 3,600 Instagram followers and over 700 followers on LinkedIn.

  21. 20   Aside from accountants and lawyers, most other students have no form of tax education in their curriculum. There have been calls for this to change; Mustapha et al., ‘Need Analysis of Tax Education for Non-Accounting Program’.

  22. 21   Ade Adefeko, ‘A Case for a More Robust Approach to Boosting Nigeria’s Tax Revenues’ (The Cable, 3 April 2018), <www.thecable.ng/case-robust-approach-boosting-nigerias-tax-revenues> accessed 26 May 2022.

  23. 22   Tunde Chris Odediran, ‘The Rich Must Pay’ (The Interview, 12 May 2021), <https://theinterview.ng/2021/05/12/the-rich-must-pay/> accessed 26 May 2022.

  24. 23   Ayo Bankole Akintujoye, ‘Nigeria’s VAT Increase: Penny-Wise, Pound Foolish’ (The Cable, 15 September 2019), <www.thecable.ng/nigerias-vat-increase-penny-wise-pound-foolish> accessed 26 May 2022.

  25. 24   Taiwo Oyedele, ‘Guess How Many Nigerians Pay Tax and How Our Government Spends the Money’, <www.pwc.com/ng/en/assets/pdf/tax-watch-june-2016.pdf> accessed 26 May 2022.

  26. 25   McCulloch, Moerenhout and Yang, ‘Building a Social Contract?’

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