TAXATION AND NIGERIAN ECONOMY
BENCHMARKING VALUE ADDED TAX 2000–2020
Keywords:Economic Growth, Gross Domestic Product, GDP, Value Added Tax, VAT
The economic growth of any nation depends on government ability to generate adequate revenue to provide infrastructural facilities needed to strengthen the productive capacity of the economy. VAT seems to be one of the most effective means of mobilizing a nation’s internal revenue and providing conducive environment for economic growth. The main focus of this study is to investigate the effect of VAT on Nigerian economy to discover the imperativeness of the tax policy. Descriptive research design was adopted for this study. Data for VAT and RGDP were obtained from the CBN Statistical Bulletin and Federal Inland Revenue Service (FIRS) Publications for the period 2000-2020 and analyzed using SPSS 20 software. It was discovered that VAT has a significant effect and positively related to GDP. The study concludes that VAT revenue made a significant contribution to the Economic Growth of Nigeria within the period under review. Hence, the study recommended that Nigerian government should use VAT proceeds to improve standard of living of the populace and infrastructures in order to strengthen the productive capacity that will ultimately translate to economy growth.