THE ANALYSIS OF RELATIONSHIP BETWEEN TAXES COLLECTED BY THE FEDERAL GOVERNMENT AND ECONOMIC GROWTH IN NIGERIA

Abstract

This study investigates the long term connection between the federal government taxes collection regime and economic growth of Nigeria. Sequence data was sourced from Apex Bank bulletin and descriptive statistics was employed to study the statistical properties of the data. The Jarque-Bera test statistic for all the tax instruments indicates that we can assume normality of the independent variables at 5% level of significance. Stationarity check was carried out using Augmented Dickey Fuller (ADF) test and the results showed that all the adaptable were immobile at level while stationarity was achieved at first order differencing. Co-integration test was equally put through to confirm the existence of possible continuing balance connections amid the adaptable over time and the result implies that the perceived connections between the predictors’ variables and economic growth are sustainable over time. The study therefore recommends that concerted efforts should be made to increase revenue collection from taxes by the federal government to augment the dwindling resources from a mono-economy source (oil revenue) in order to impact positively on Nigerian economic growth and development.