Tax Components and Economic Growth in Nigeria
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This paper examined the effect of Nigerian tax system on her economic growth. It set out to determine the causal relationship between various identified components of taxes considering her growth trajectory. The paper answered the question of the contribution of the identified tax components using econometric methodology. Using the cointegration methodology ala granger the paper estimated the disequilibrium return rate and found that the contribution of Petroleum Profit Tax to gross domestic product is positive and significant over the years and a further increase will result to a rise in gross domestic product. This shows that PPT is vital to the growth of the Nigerian economy. Therefore, the government and the Institution in charge of tax collection should ensure that companies dealing with petroleum both in downstream and upstream should not avoid or evade tax. The study fails to accept the null hypothesis which state that PPT as a component of taxation has no significant impact on GDP. This result agrees with the findings of other earlier studies.