IMPACT OF FEDERAL COLLECTED TAXES ON ECONOMIC GROWTH OF NIGERIA

Abstract

The broad objective of the study is to determine the impact of Federal collected taxes on the economic growth of Nigeria. In order to achieve this, the study specifically ascertained the extent to which custom and excise duties, petroleum profit tax and education tax affect the gross domestic product of Nigeria. The study employed an ex-post facto research design and utilized primarily time series data, which were largely obtained from secondary sources over a 13-year period, from 2010 to 2022. Descriptive statistics were used to measure the central tendency and dispersion. Ordinary least square regression analysis was applied in hypothesis testing which found that: custom and excise duties positively and significantly affect the gross domestic product of Nigeria (p-value = 0.0037); petroleum profit tax has a non-significant negative effect on the gross domestic product of Nigeria (p-value = 0.0699); education tax has a non-significant positive effect on the gross domestic product of Nigeria (p-value = 0.3204). The study recommends that the government should optimize customs procedures by minimizing bottlenecks and establishing a taxation system that is both transparent and equitable. Furthermore, implementing measures to combat smuggling and boost compliance will not only fortify the positive impact of custom and excise duties on economic growth but also foster a more efficient and accountable fiscal environment.