Tax Revenue Generation and Economic Growth: A Pre and Post Treasury Single Account Implementation in Nigeria

Abstract

The main objective of this study is to examine the relationship between tax revenues generated and the economic growth of Nigeria in a pre and post treasury single account implementation era. The study specifically assessed the relationship between Value Added Tax and the economic growth of Nigeria in a pre and post TSA implementation periods. It also determined the relationship between Company Income Tax and economic growth in a pre and post TSA era in Nigeria. The study also verified the relationship between Customs and Excise Duty and the economic growth in Nigeria, in a pre and post TSA implementation period in Nigeria. The population for the study was Nigerian economy and the sample size was six years of pre TSA era and Six years of post TSA implementation era. This sample was selected because TSA is just six years old in Nigeria and to compare the pre and post, the researcher had to take the same number of years for meaningful comparison. Three hypotheses were formulated for the study in null form using the Gross Domestic Product(GDP) as the dependent variable on Tax revenues comprising Value Added Tax(VAT), Company Income Tax (CIT) and Customs and Excise Duty (CED) which are the independent variables. Data for the study was collected from statistical records and bulletins from Central bank of Nigeria and Federal inland revenue bulletins as secondary data for the period of the study. The analysis tool for the study was a Regression and correlation analysis tools which aimed at establishing the relationship between the economic growth of Nigeria and the Tax revenue sources used as the independent variables prior to the introduction of TSA and after the introduction of TSA in Nigeria. The result shows that before the implementation of TSA, VAT has a positive and insignificant effect on the GDP while CIT had a positive and insignificant effect on GDP and CED had a negative and insignificant effect on GDP in Nigeria. On the post TSA implementation