Abstract

European Journal of Economics,Finance &Administrative Sciences,USA 2011 February issue 29 pp.133-144. Nigerian government considers trade as the main engine of its development strategies because of the implicit belief that trade can create job, expand markets, raise incomes and facilitate competition. The government in its desire to achieve its trade policy established the National Economic Empowerment and Development Strategies (NEEDS) of which the reform of Nigeria Custom Services is one of the major functions. Over the years, custom and excise duties have been a major source of revenue. However, the problems of corruption, fraud and malpractices together with inefficiencies and ineffectiveness in operations have hindered the desire to contribute maximally to the economic development of the nation. This paper has the objectives of introducing measures to eradicate corruption, fraud and dishonesty, and ensure the eradication of smuggling activities for full collection of revenue due from customs and excise duties. The work adapted both primary and secondary data systems to obtain the relevant information from the sampled population. Chi-square and multiple regression analysis are the statistical tools used to analyze the data obtained for the testing of the two formulated hypotheses. The findings are that corruption, fraud and malpractices have strongly negated the revenue collected by Nigeria Custom Services for the federation account, and that there is a very strong relationship between customs and excise duties and economic development of Nigeria. For improvement and diversification of Nigeria major source of revenue from oil to non-oil sectors, the following recommendations must be in active implementation. There is the need for the federal government to reorientate the Nigeria Custom Services to improve their skills and knowledge in order to eradicate tax evasion and tax avoidance in the system. The government needs to fully implement the various reforms so that various loopholes that serve as conduit pipes for free outflow of revenue to individual hands can be blocked. Corruption and fraud need to be checked in the system.