ANALYSIS OF THE IMPACT OF FEDERALLY COLLECTABLE TAXES ON ECONOMIC
GROWTH OF NIGERIA (2000-2015)

1 Nmesirionye, Josephine Adanma, (Ph.D)
1 adandynmes@yahoo.co.uk.
2 Nwawuru Clifford Ebere
2 nwawuruc@yahoo.com
3 Ekwuruke Henry
3 henrikuke@yahoo.com
1,2,3 Department of Accounting
Michael Okpara University of Agriculture, Umudike

ABSTRACT
Tax revenue is the main stay of every modern economy because it is the basic source of revenue for financing government expenditure. Government utilization of tax revenue generates multiplier effect that stimulates economic growth. This study was carried out to empirically ascertain the impact of federally collectable taxes on economic growth of Nigeria from 2000 - 2015. Autoregressive Distributed Lag model was specified and estimated using time series data from Central Bank of Nigeria Statistical Bulletin. The model captured the long-run static and short run dynamic impact of tax components on economic growth. The empirical results of the estimated model indicated that there was a positive but insignificant impact of various tax components on economic growth of Nigerian in the long run. It was recommended that government should overhaul the tax management system to block the revenue leakages inherent in the system to ensure that tax revenue is expended directly and prudently to generate the multiplier effect required to stimulate growth of the Nigeria economy. Also government should ensure that the tax policy is not affecting the marginal productivity of oil companies, that custom and excise duties should not be too high as to encourage diversion of imports to our neighboring countries, and the value added tax should be at level that do not interfere with consumer demand and increase the prices of domestic goods above this competitive levels.
Keywords: Taxation, economic growth, petroleum profit tax, company income tax, value added tax, custom and excise duty and education tax.

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