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Published online by Cambridge University Press: 02 December 2020
The use of experts in the review of tax cases is recognized globally. Nigeria appears to appreciate the importance of this practice. However, several previous attempts to establish tax courts or tribunals have been frustrated due to a lack of constitutional support. In the search for a better model for Nigeria, this article examines the US and Canadian experiences of using specialized tax courts or tribunals to see what lessons Nigeria could learn. The two north American experiments justify the use of tax courts as better alternatives to what Nigeria currently has. In particular, the Canadian experience appears to be more suited to the Nigerian context. Therefore, it is argued that Nigeria's 1999 Constitution should be amended to establish a Tax Court of Nigeria, which should be recognized as a superior court of record.
PhD (Osgoode), LLM (Yale), LLM (Dalhousie), LLB (Enugu). Senior lecturer, Faculty of Law, University of Nigeria, Nsukka; partner, Alliance Law Firm.
1 Organization for Economic Cooperation and Development (OECD) “The development dimension: Fostering development in a global economy: A whole of government perspective”, available at: <https://books.google.com/books?id=N8QZhFEiMkQC&printsec=frontcover#v=on0epage&q&f=false> (last accessed 26 October 2020). In this book, OECD argues (at 38) that: “An essential element of trade liberalization is the gain from specialization.”
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11 Federal Revenue Decree No 13 of 1973.
12 Id, sec 7.
13 1979 Constitution, sec 1.
14 Federal Revenue Decree, sec 8.
15 1979 Constitution, sec 236.
16 The government of Alhaji Shehu Shagari, a democratically elected president of Nigeria, was overthrown by General Mohammadu Buhari on 31 December 1983. Buhari's own military regime was overthrown by yet another coup d’état staged by General Ibrahim Babangida on 27 August 1985. The gale of military interventions continued until 29 May 1999. For a brief history of military interventions in Nigeria, see Olusoji, J, Olusanmi, A and Nelarine, C “Military intervention in the Nigerian politics and its impact on the development of managerial elite: 1966–1979” (2012) 8/6 Canadian Social Science 45 at 46–47Google Scholar.
17 A regime that governed with military decrees and edicts.
18 Constitution (Suspension and Modification) Decree No 1 of 1984.
19 This is Nigeria's current constitution. It came into force on 29 May 1999. Tunde Ogowewo argues that the 1999 Constitution not only lacks moral authority but also legitimacy since it is a nullity because it is not an act of the people. He, therefore, urges Nigerian courts to annul the constitution in order, among other things, to discourage future coup plotters from overthrowing a democratically elected government only to use a decree in the name of a constitution to white-wash their sins upon leaving power, as is evident in the 1999 Constitution: Ogowewo, T “Why the judicial annulment of the Constitution of 1999 is imperative for the survival of Nigeria's democracy” (2000) 44/2 Journal of African Law 135CrossRefGoogle Scholar.
20 1999 Constitution, sec 251.
21 Id, sec 251(1)(a).
22 Unfortunately, both the 1979 and 1999 Constitutions were products of the military. Neither is strictly an act of the people. Of note is that Professor Ben Nwabueze has argued that the defunct 1979 Constitution (and, by extension, the extant 1999 Constitution due to the similarities it shares with the making of the 1979 Constitution) was not autochthonous since the people of Nigeria did not give themselves the constitution through democratic participation: Nwabueze, B The Presidential Constitution of Nigeria (1983, Nwamife Publishers) at 2–6Google Scholar.
23 Value Added Tax Decree No 102 of 1993, sec 24.
24 This decree repealed the Sales Tax Decree No 7 of 1986.
25 See 1999 Constitution, sec 315.
26 One major modification is that it subordinated the 1979 Constitution to military decrees by suspending the supremacy of the constitution: Ogowewo “Why the judicial annulment”, above at note 19 at 142.
27 (2009) 13 NWLR 201 (pt 1157) 200.
28 FIRS (Establishment) Act, 2007, fifth sched, para 17.
29 Value Added Tax Act, 2004, sec 24.
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31 See Decree No 13 1973, which was later renamed the Federal Revenue Court Act 1973.
32 (1973) LPELR-1595 (SC) at 18, paras B–C.
33 1979 Constitution, sec 236.
34 (1987) LPELR-1193(SC) at 29–30, paras G–F.
35 1979 Constitution, sec 236.
36 The government of General Abdulsalam Abubakar handed over power to the newly elected civilian government of President Olusegun Obasanjo on 29 May 1999.
37 1999 Constitution, sec 251.
38 NNPC and Another v Orhiowasele and Others (2013) LPELR-20341 (SC); NDIC v Okem Enterprise Ltd and Another (2004) LPELR-1999 (SC); Ntuks and Others v NPA (2011) LPELR-8876 (CA).
39 (2016) LPELR-40612 (SC) at 62–63, paras D–C.
40 See FIRS Act, fifth sched, para 17.
41 See Odinkonigbo and Ezeuko “Does Nigeria follow?”, above at note 30.
42 Ibid.
43 (2017) LPELR-43800 (CA).
44 (2017) LPELR-42868 (CA).
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49 Baum “Probing the effects”, above at note 47.
50 Id at 1667–68.
51 Id at 1675.
52 Id at 1667.
53 Id at 1677–78.
54 Unah The Courts of International Trade, above at note 45 at 7.
55 Baum Specializing the Courts, above at note 3 at 34.
56 Legomsky Specialized Justice, above at note 7 at 20–32. The 12 factors are: mix of law, fact and discretion; technical complexity; decree of isolation; cohesiveness; degree of repetition; degree of controversy; clannishness; peculiar importance of controversy; dynamism; logistics: volume, time per case and geographical distribution; special need for prompt resolution; and unique procedural needs.
57 Id at 20.
58 Tax Policy Center “Why are taxes so complicated?”, available at: <https://www.taxpolicycenter.org/briefing-book/why-are-taxes-so-complicated> (last accessed 26 October 2020).
59 A Abuh and A Afolabi “Reps judicial panel decries delays in justice delivery” (15 October 2019) The Guardian, available at: <https://guardian.ng/news/nigeria/national/reps-judicial-panel-decries-delays-in-justice-delivery/> (last accessed 26 October 2020).
60 Office of Justice Program “Problem-solving courts”, above at note 3.
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62 26 US Code (2019), sec 7482(a).
63 See Tax Reform Act, 1969 Pub L No 90 - 172 83 Stat 730 (1969).
64 Laro, D “The evolution of the Tax Court as an independent tribunal” (1995) 1 University of Illinois Law Review 17 at 23Google Scholar.
65 26 US Code (2019), sec 7443(b).
66 Lederman, L “(Un)appealing deference to the tax court” (2014) 63 Duke Law Journal 1835 at 1836–37Google Scholar.
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68 See 26 US Code (2019), sec 7441. Article I courts are federal courts created by Congress in exercise of the legislative power(s) conferred on it by article 1 of the US Constitution. These courts are generally referred to as “legislative courts” set up by Congress to review decisions of specified agencies of the federal government. In the case of the US Tax Court, it is set up to review decisions of the IRS, an agency of the US federal government. Article I courts enjoy certain levels of independence from the legislative and executive arms of the US government.
69 These are courts established under article III of the US Constitution. They form the judicial branch of the US federal government. They include the US Supreme Court and other lower courts created by Congress to adjudicate cases or controversies arising from certain federal laws.
70 Lederman “Tax appeal”, above at note 67.
71 320 US 489 1943.
72 See 26 US Code (2019), sec 7482.
73 This was the first income tax legislation enacted in Canada. This act was enacted principally to raise funds for the prosecution of the First World War.
74 The Tax Court was established by SC 1980-81-82-83, c 158, as amended.
75 Courts Administration Service Act, SC 2002 c 8, sec 60.
76 Alarie, B and Green, A “Policy preferences expertise in Canadian tax adjudication” (2014) 62/4 Canadian Tax Journal 985 at 991Google Scholar.
77 (2002) SCC 33.
78 JM Evans “Judicial confessions or how I learned to love the Income Tax Act” (10 June 2011) (speaking notes for an address to the annual meeting of the Ontario Bar Association, tax law section, Toronto, 10 June 2011), available at: <http://www.fca-caf.gc.ca/fca-caf/pdf/speech-Jun10-2011.pdf> (last accessed 26 October 2020).
79 467 US 837 1984.
80 These sub-issues are not exhaustive.
81 Canada Revenue Service “Resolving disputes”, available at: <https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/after-you-file-your-corporation-income-tax-return/resolving-disputes.html> (last accessed 2 November 2020).
82 28 February 2019 - 2019 TCC 47.
83 The TCC gave this decision contrary to the Supreme Court of Canada's decision in R v Conway [2010] 1 SCR 765, which empowered administrative tribunals to consider and grant equitable relief under the charter.
84 30 April 2014 - 2014 BCSC 720.