Taxation and Economic Growth in Nigeria

Adebamiwi, Oluwole Daniel & Ojo, Victor. Oluwaseyi, Volume 4 Issue 2, December 2023 Pages 55-61, Published: 2023-12-14

Abstract

The relationship between taxes as a tool for budgetary policy with the purpose of ensuring the constancy and reliability of the overall economy and the economic development of developing nations is one of the most crucial topics covered in economics. The study's goal is to determine how taxes serve as a stimulus to economic growth. Multiple regression analysis was used to analyze data. Secondary data were collected from Federal Inland Revenue Statistical Report and from CBN Statistical Bulletin for the period 2011 – 2021. The study concluded that Petroleum profit tax (PPT) has a negative relationship with GDP, which is not statistically significant, whereas capital gain tax (CGT) and company income tax (CIT) have positive relationship with GDP because it is statistically significant. It is recommended that government should make sure that all businesses are included in the tax system and completely adhere to the tax payment requirements. In reality, it is necessary to impose penalties on businesses that evade taxes. Also, there is the need to enhance the mechanisms towards collection of tax