Pages: 1-14

Abstract

The general objective of this work was to find out the problems of intergovernmental fiscal relations in Nigeria. This is because reports in recent weeks have highlighted the seriousness by various stakeholders for a new revenue sharing formula. Firstly, the Revenue Mobilization Allocation and Fiscal Commission has been consulting the 36 states governors and other stakeholders on its plan to fashion a new formula for sharing the nation’s revenue among the three tiers of government. Already, it has set up six teams that will visit all the states of the federation to ascertain indices for determining the new revenue allocation formula. Since the restoration of civil rule in 1999, it has been at the centre of acrimony between the federal and state governments. The 1999 Constitution is not clear on its status within the lopsided federal structure. There are 774 councils listed in the 1999 Constitution. Their functions are critical to the welfare of the local areas. But, many of them are not living up to expectation as vehicles for effective grassroots democracy and socio-economic development because they are handicapped by certain constraints which have retarded their growth and performance. Data for this study was from documentary sources. After the collection of data, the technique of content analysis was used to analyse the data in order to discovered that some of the problems o include that it has more responsibilities than the finances that comes into it, it was also discovered that the nature of State Local Government Joint Account contributes to the failure of states in carrying out its responsibilities. Based on the findings, the researchers recommended that the federal government set up a committee to investigate the current revenue/ taxing structure between the three levels of government and their responsibilities to ensure that local governments in the country have as much finances as their responsibilities. The paper concluded by positing that if these issues are not addressed, Nigeria’s fiscal federalism will remain at the crossroad.