Tax Policy and Economic Growth In Nigeria
Abstract
The Nigerian economy depends on the revenue generated through oil production. However, in recent years the decline in oil prices across the world forced the government to lower domestic oil prices. Consequently, the revenue generation capacity of Nigeria decreased significantly. In view of the prevailing situation, it is important for the government to identify other sources of revenue generation. Thus, we examine the sensitivity of the Nigerian economy on existing tax policies. The study is based on secondary data from 1998 to 2017. The results suggest that the Nigerian government has to focus on revenue generation through direct taxes which are positively associated with economic growth. The results suggest that the government should avoid indirect taxes as it adversely affects economic growth. Moreover, the government must focus on addressing corruption and implement tax reforms. The government may also enhance economic growth by channelizing private savings in productive sectors of Nigeria.Keywords: Economic growth, direct taxes, indirect taxes, taxation policy.References
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