IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 9 NO. 6 2024
DOI: 10.56201/ijefm.v9.no6.2024.pg72.84

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Analysis of Government Taxation and Economic Development in Nigeria

Andabai, Priye Werigbelegha Ph.D

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Abstract

The paper assesses how government taxes affect Nigerian economic growth between 1993 and 2023. The paper used an ex-post facto research design and utilised the World Bank Index 2022 and Central Bank of Nigeria (CBN) annual reports as secondary sources. The dependent variable was human development index, and the independent variables consist of petroleum profit tax and corporation income tax. Ordinary least squares econometric methods are used in the formulation and testing of hypotheses. The unit root test turned out that every series is in order. The analysis reveals that the human development index of Nigeria is greatly influenced by profit petroleum tax. The Nigerian human development index is largely influenced by company income tax. The r2 predicted that, changes in government taxation variables help to explain roughly 60% of the fluctuations in Nigerian economic growth. The research comes to the conclusion that Nigerian economic progress is much influenced by taxes. Therefore, the research advises the government and tax/revenue agencies in order to monitor the flow of tax income accumulated at every level to the country and the efficient distribution of tax revenue to underdeveloped sectors in the economy by means of proactive actions and processes.

keywords:

Government Taxation, Economic Development, Nigeria

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