Relevance of Tax Revenue and Economic Growth in Nigeria (2008-2018) (Published)
This study aims at investigating the relevance of tax revenue in driving economic growth in emerging market economy context. . Using data extracted from central bank of Nigeria statistical bulletin for various years and auto-regression estimation model, our study documents the existence of significant and positive relationship between petroleum profit taxes (PPT), Company Income Tax (CIT) on economic growth in Nigeria. Our findings further reveal that Value Added Tax (VAT) and Custom –excise duty (CED) exert negative influence on economic growth. However, the study provide evidence that VAT and CED are insignificant in determining the economic growth in emerging market economy context with special interest in Nigeria This study provide further evidence that the higher the amount of tax revenue generated, the higher the level of economic growth in the economy. There is a recommendation therefore that strong institutional reforms are panacea to prevent leakages of revenue from VAT and CED.
Keywords: Company Income Tax, Nigeria economy, Petroleum Profit Tax, Value Added Tax, economic growth
Effects of Value Added Tax and Custom Duties on Revenue Generation in Nigeria (2000-2016) (Published)
The study examined value added tax and customs duties on revenue generation in Nigeria. Secondary data was sourced from Federal Inland Revenue Service (FIRS) ranging from 2000 to 2016. Autoregressive Distributed Lag (ARDL) and Granger causality tests were used as the estimation techniques. The findings of the study revealed that the F-statistics value was 2.883868 which is lesser than both the lower bound and the upper bound values of 3.79 and 4.85 respectively at the 5percent level of significance which implies that there is no long-run relationship among value-added tax, customs duties and revenue generation. It was equally revealed that there is no causality among value-added tax, customs duties, and revenue generation. The study concluded that value-added tax and customs duties no significant effect on revenue generation and there is no long-run relationship among value-added tax, customs duties and revenue generation in Nigeria during the study period. Thus, it is recommended that the fiscal policy should discourage tax avoidance by emulating measures for compliance of value added tax and customs duties
Keywords: Custom and Excise duties, Revenue Generation, Tax, Value Added Tax
The Impact of Company Income Tax and Value-Added Tax on Economic Growth: Evidence from Nigeria (Published)
This study examined the impact of companies’ income tax, value-added tax on economic growth (proxy by gross domestic product) in Nigeria. Secondary time series panel data was collected for the period 2005 to 2014 from the Statistical Bulletin of the Central Bank of Nigeria (CBN). The study employed Ordinary Least Squares (OLS) technique based on the computer software Windows SPSS 20 version for the analysis of data, where gross Domestic product (GDP), the dependent variable and proxy for economic growth, was regressed as a function of company income tax (CIT) and value-added tax (VAT), the independent variables. The results of the analysis showed that both company income tax and value-added tax have significantly positive impact on economic growth. Based on the findings, the study recommended that government should strengthen the tax administration system to broaden the tax income, and embark on tax education to ensure voluntary tax compliance. The study also recommended that the tax authorities should employ qualified tax professionals who should be regularly trained and be retained in the tax administration system for efficient tax administration and collection.
Keywords: Company Income Tax, National Income, Value Added Tax, economic growth
Re -Engineering Vat Administration in Nigeria for Economic Development (Published)
The study examined the possibility of “Re-engineering VAT Administration in Nigeria for Economic Development (1994-2014)”. The study used across sectional survey design involving the survey of existing data (secondary sources). The research instruments used in collection of data for this study were mainly secondary data from the FIRS Website, CBN & NBS Annual Statistical Bulletins. This study used the econometric technique of Ordinary Least Square (OLS) in form of Multiple Linear Regressions. The regression model was estimated through the use of Statistical Package for Social Sciences (SPSS). The study found that VAT is of immense benefit to government. Through taxation, government ensures that resources are channeled towards important projects in the society. However, VAT is being mismanaged in Nigeria as the study has conclusively revealed that: There is no significant relationship between value added tax and revenue growth in Nigeria, there is significant relationship between value added tax and the consumption pattern in Nigeria and there is no significant relationship between value –added tax and the economic development in Nigeria from 1994-2014. Therefore, the study recommends that: Efforts should be made by the government to fight corruption and if possible, introduce capital punishment depending on the degree of mismanagement of public funds or embezzlement of public funds to deter those who steal VAT funds. Also value added tax (VAT) Act should be amended further to impose VAT based on destination principle. This will enable VAT to be imposed on imported services rendered by a non-resident company outside Nigeria.
Keywords: Administration, Economic Development, Government Revenue, Re-Engineering, Value Added Tax, consumption patterns