TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH

<p>This study investigates the relationship between tax and economic growth (GDP) using the Auto-Regressive Distributed Lag (ARDL) bound test approach. The study further decomposed tax into company income tax (CIT), petroleum profit tax (PPT), value-added tax (VAT) and excise and custom duties...

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Autor principal:	Justine Tochukwu Nwanakwere
Formato:	article
Lenguaje:	EN
Publicado:	Universitas Muhammadiyah Yogyakarta 2019
Materias:	tax ardl economic growth taxation Economic theory. Demography HB1-3840
Acceso en línea:	https://doaj.org/article/e5a54e80f68440db8e18dd0d29273d3c
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spelling	oai:doaj.org-article:e5a54e80f68440db8e18dd0d29273d3c2021-12-02T13:13:54ZTAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH1411-99002541-5506https://doaj.org/article/e5a54e80f68440db8e18dd0d29273d3c2019-10-01T00:00:00Zhttps://journal.umy.ac.id/index.php/esp/article/view/6470https://doaj.org/toc/1411-9900https://doaj.org/toc/2541-5506<p>This study investigates the relationship between tax and economic growth (GDP) using the Auto-Regressive Distributed Lag (ARDL) bound test approach. The study further decomposed tax into company income tax (CIT), petroleum profit tax (PPT), value-added tax (VAT) and excise and custom duties (ECD), then examined the effect of each of them on economic growth. The data for the study were obtained from Federal Inland Revenue Service (FIRS) and Central Bank of Nigeria (CBN) bulletin, spanning from 1981-2014. The ARDL results show no cointegration among the variables. Interestingly, the short run results reveal that total tax is insignificant while the decomposed taxes are significant. Petroleum profit tax and value-added tax have positive relationship with GDP while company income tax and excise and custom duties have negative relationship with GDP. From these findings, the study recommends an effective use of taxation so as to improve the impact of tax on the Nigerian economy. Also, efficient tax regulation should be put in place to mitigate the issue of tax evasion, especially among firms and corporate entities, and improve the contribution of CIT to economic growth.</p>Justine Tochukwu NwanakwereUniversitas Muhammadiyah Yogyakartaarticletaxardleconomic growthtaxationEconomic theory. DemographyHB1-3840ENJurnal Ekonomi & Studi Pembangunan, Vol 20, Iss 2, Pp 124-134 (2019)
institution	DOAJ
collection	DOAJ
language	EN
topic	tax ardl economic growth taxation Economic theory. Demography HB1-3840
spellingShingle	tax ardl economic growth taxation Economic theory. Demography HB1-3840 Justine Tochukwu Nwanakwere TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
description	<p>This study investigates the relationship between tax and economic growth (GDP) using the Auto-Regressive Distributed Lag (ARDL) bound test approach. The study further decomposed tax into company income tax (CIT), petroleum profit tax (PPT), value-added tax (VAT) and excise and custom duties (ECD), then examined the effect of each of them on economic growth. The data for the study were obtained from Federal Inland Revenue Service (FIRS) and Central Bank of Nigeria (CBN) bulletin, spanning from 1981-2014. The ARDL results show no cointegration among the variables. Interestingly, the short run results reveal that total tax is insignificant while the decomposed taxes are significant. Petroleum profit tax and value-added tax have positive relationship with GDP while company income tax and excise and custom duties have negative relationship with GDP. From these findings, the study recommends an effective use of taxation so as to improve the impact of tax on the Nigerian economy. Also, efficient tax regulation should be put in place to mitigate the issue of tax evasion, especially among firms and corporate entities, and improve the contribution of CIT to economic growth.</p>
format	article
author	Justine Tochukwu Nwanakwere
author_facet	Justine Tochukwu Nwanakwere
author_sort	Justine Tochukwu Nwanakwere
title	TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
title_short	TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
title_full	TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
title_fullStr	TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
title_full_unstemmed	TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH
title_sort	tax and economic growth in nigeria: an ardl approach
publisher	Universitas Muhammadiyah Yogyakarta
publishDate	2019
url	https://doaj.org/article/e5a54e80f68440db8e18dd0d29273d3c
work_keys_str_mv	AT justinetochukwunwanakwere taxandeconomicgrowthinnigeriaanardlapproach
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TAX AND ECONOMIC GROWTH IN NIGERIA: AN ARDL APPROACH

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