Tax Law and Revenue Generation: An Assessment of the Value Added Tax Act and Its Implementation in Enugu State

Revenue generation through value added tax is a central instrument of fiscal federalism in Nigeria, yet the constitutional basis and implementation of VAT have been contentious, as demonstrated by the Rivers State government challenge to federal VAT collection authority before the Federal High Court in 2021. In South East states such as Enugu, the practical administration of VAT by the Federal Inland Revenue Service and associated compliance challenges among small and medium enterprises warrant systematic examination. This study assesses the VAT Act and its implementation in Enugu State, evaluating the constitutional framework for VAT jurisdiction, the Federal Inland Revenue Service enforcement activities, compliance levels among Enugu-based businesses, and the Rivers State litigation impact on national VAT administration. A doctrinal and empirical methodology is adopted, reviewing the VAT Act Cap V1, the Finance Acts of 2019, 2020, and 2021, relevant court decisions, and FIRS compliance reports for the South East zone. The study evaluates whether the current VAT framework efficiently captures tax revenue while respecting constitutional federalism. Available fiscal law literature identifies the unresolved debate over state-level VAT authority following the Rivers State litigation as the most significant legal uncertainty confronting VAT administration in southern Nigeria. The Fiscal Federalism Theory and Tax Justice Framework provide the analytical reference. Recommendations address legislative clarification of VAT jurisdiction and simplified SME compliance. Keywords: value added tax, tax law, fiscal federalism, Enugu State, revenue generation.