KIJHUS Volume. 1, Issue 2 (2020)


Efuntade Alani Olusegun


Company Income Tax Value Added Tax Personal Income Tax Oil revenue non-oil revenue

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This study examined value added tax and its effect on revenue generation in Nigeria. Specifically, the study examined the effect of consumption tax on total government revenue in Nigeria, personal income tax on oil revenue in Nigeria, goods and service tax on non-oil revenue in Nigeria and company income tax on total public borrowing in Nigeria. Secondary data were used in the study. Data were sourced from Central Bank of Nigeria (CBN) statistical bulletin, Budget office of the Federation, as well as the World Bank Development Indicator Database. Collected data covered the period of 20 years spanning from 1999-2019. Data collated were analysed using both descriptive and Vector Error Correction Model method of analysis. Descriptive analysis conducted in the study include the mean, standard deviation, Kurtosis, and Jarque-Bera statistics of each variable. The findings revealed that there was presence of co-integration (long-run relationship) among the variables in the model, actual public consumption tax and personal income tax had 0.699243 and 1.798114 (P=0.0043, 0.0034) respectively significant relationship with revenue generation in Nigeria, while goods and service tax and revenue generation (0.209789, (P=0.0911) are not significantly related to revenue generation of the country in the long run. The study therefore concluded that there is significant relationship between consumption tax and revenue generation in Nigeria. Likewise, the result of the study concluded that value added tax is beneficial to the Nigeria economy, and the research, shows that value added tax is statistically significant to revenue generation in Nigeria. From the findings, for Nigeria to attain its economic growth and development, Nigeria must be able to generate enough revenue in order to meet up with the challenges of her expenditures in term of provision of social amenities and the running costs of the Government. The result of this research work recommend that government should ensure efficiency and effectiveness in the discourse of tax administration and that if more goods and services are taxed, the revenue base of the country will increase both in the long run and short run