Indirect tax and the economy: Evidence from Nigeria, 2000 to 2019

Abstract

The study adopted the ordinary Least – Square Regression Analysis to analyse the data. Descriptive Statistics were used to describe the characteristics of the Variables, augmented Dickey – Fuller unit root test was used for the stationary test of the data. Johansen co-integration test was used for the long-run relationship of the variables. Ordinary Least Square (OLS) was used to test the hypotheses at a 5% level of significance. Our findings revealed that Value Added Tax (VAT) has an insignificant positive impact on GDP in the Country. Import Duty IMD has a significant positive impact on GDP in Nigeria while the Export Duty (EXD) has an insignificant impact on the GDP. The study recommended that the Nigeria government can grow its economy through VAT if the revenue from the tax is not invaded, avoided and is properly administered. Secondly the government should concentrate on growing strategically with the import tax productivity since it shows a positive significant impact on GDP, Similarly the government of Nigeria should equally put in concerted efforts to improve Export Duty Tax revenue.