Abstract
Abstract The aim of the study is to examine the relationship between government revenues and the economic growth of Nigeria. The study employs exploratory and ex-post facto research designs while using secondary form of data spanning from 1981 to 2018 collected from the Federal Inland Revenue Services (FIRS), National Bureau of Statistics and CBN statistical bulletin. The relationship is tested by using Ordinary Least Squares (OLS) regression technique. The result reveals that federally received revenue and Value Added Tax (VAT) have a moderate positive relationship with the economic growth. The study provides evidence that there is a need for the government to formulate relevant revenue policies that will boost government income in order to have more favourable implication on the economy.
Highlights
Present day government needs a great deal of income in order to perform its duties viably
From the findings of the study, the Ordinary Least Squares (OLS) regression analysis adopted to test hypotheses has shown that the federally received revenue has a moderate relationship with the economic growth of Nigeria and the p-value of 0.001 % < 0.05 % significance level
The regression result further reveals that there is a positive relationship between Value Added Tax (VAT) revenue and change in Gross Domestic Product (GDP) in Nigeria with a p-value of 0.001% < 0.05% significance level
Summary
Present day government needs a great deal of income in order to perform its duties viably. It is necessary for governments to establish various income sources in order to increase its income base that will enable it to fund its obligations. There are income sources in Nigeria, which incorporate significantly raw petroleum, unrefined petroleum, outer acquiring and remote guide’s income. As indicated in 2018 National Budget of Nigeria, the key sources of income can be partitioned into three bases, which are: raw petroleum sources, non-unrefined petroleum sources and external borrowing. External sources of income can be featured into nine principal sources with brief clarifications as follows: Duty, Rates, Expenses, Permit Fee, Excess of the Open Part Units, Fine and Punishments, Endowments and Awards, Printing of Paper Cash and Borrowings. In connection to charge income, charge is a mandatory duty forced by an open authority and the administration against which citizens cannot guarantee anything (Asagunla & Agbede, 2018). The embodiment of an assessment, as recognised from different charges by the administration, is the nonappearance of an immediate compensation (i.e., trade of support) between the citizen and the open power
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