Impact of Selected Tax Revenue Components on the Growth Rate of the Nigerian Economy (1995–2022)
Year: 2025
Type: article
Abstract: The growth rate of an economy is crucial for an adequate understanding of its health. A negative growth rate is possible even with some level of GDP growth. Therefore, this study specifically investigated the impact of selected tax revenue components on the growth rate of the Nigerian economy for the period 1995-2022. Data were sourced from the Central Bank of Nigeria (CBN) statistical bulletin, the Federal Inland Revenue Service (FIRS) and the National Bureau of Statistics. The study employed the Auto Regressive Distributed Lag (ARDL) technique to estimate the model's parameters. The major findings of the study indicate that value-added tax (VAT), and company income tax (CIT) have positive and significant impacts on the growth rate of the Nigerian economy (GDPGr) in the long run and short run respectively while petroleum profit tax (PPT) had positive and significant impact on GDPGr only in the long run. Conversely, capital gains tax (CGT) had a positive but non-significant impact on GDPGr both in the short run and long run respectively. Based on the findings of this study, the study recommended, amongst others, the spread or increase in vat able items as well as fighting corruption to a standstill in the oil sector in order to enhance the performance of PPT and VAT in both the short-run and long run. Provision and sustenance of basic infrastructure such as power and sensitization of the citizens on the consequences of CGT payment evasion would make the impact of CIT and CGT stronger on GDPGr.
Authors: Uchenna Nnanna Anyanwu, Onyekachi Chukwu
Institution: Nnamdi Azikiwe University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4411159153