The main objective of the study is to ascertain the influence of tax revenue on economic development of Nigeria. The specific objectives are; to determine the influence of petroleum profit tax, company income tax and value added tax on economic development proxy by human development index (HDI). Annual time series data, from CBN and FIRS from 1997 to 2018 was used. The study used regression analysis. The result showed that petroleum profit tax and company income tax have significant effect on economic development while value added tax does not significantly influence economic development. The implication of the finding is that the higher the amount of tax revenue generated, the higher the level of economic development experienced by the economy. This implies that taxes that have positive effect on economic development are direct taxes, thus direct taxes exert more significant influence on economic development of Nigeria than indirect taxes. This anomaly was attributed to dysfunctional ties in tax system, loopholes in tax law and inefficient tax administration. The lower the amount of revenue generated from tax the lower the quality of development to be witnessed. Government will generate higher revenue if they strengthen the legal and regulatory framework in order to control tax evasion and tax avoidance by taxpayers, improve on the system of tax administration, .The paper therefore recommended that tax policy makers such as federal inland revenue services and other tax regulatory bodies should strengthen their regulation on tax compliance mostly on tax that are direct based to curb tax evasion and tax avoidance by tax payers, adopt strategies to improve system of tax administration, by training and re- training of tax administrators through seminars and conferences to be abreast of modern trend in tax administration in order to generate more income for development.
The Relationship between Tax Burden and Foreign Direct Investment Inflows: A Review of Empirical Literature (Published)
This study reviews literature on the relationship between tax burden and foreign direct investments (FDI) inflows across the world. Various empirical research have found contradicting outcomes of the relationship between tax burden and FDI inflows. This study aims to establish the dominant relationship between tax burden and FDI inflows. Taxation components such as tax system, tax types, tax rates, tax base, tax structures affect the amount of tax revenues collected hence the tax burden. Therefore, in this study, tax burden was represented by itself and taxation components. The research found literature has two divergent relationships between tax burden and FDI inflows: negative and none. However, the relationships largely depended on the taxation components and country or economic region under study. The research findings demonstrate that world over there is no universal consensus on the relationship between tax burden and FDI inflows. Therefore, tax competition theory, which proposes that there is inverse relationship between tax burden and FDI inflows may not be applicable universally. The research implication is that the paper has demonstrated that inverse relationship between tax burden and FDI inflows is not universal. There is need to establish the relationship between tax burden and FDI inflows in any specific country or economic region. Countries that rely on the presumptive inverse relationship between tax burden and FDI inflows to shape their tax policy to attract FDI inflows should rely on empirical research findings undertaken in the country or economic region. The research recommends empirical studies on the relationships between tax burden and/or taxation components, and FDI inflows in specific countries and economic regions.
TAXATION AND AGRIBUSINESS TECHNOLOGY INTERFACE: STRATEGIC FINANCIAL MANAGEMENT IMPERATIVES IN NIGERIA (Published)
This study examined the moderating influence of technology in the relationship between taxation and return on investment in agribusinesses operating in Nigeria. Seven agribusinesses listed in the Nigerian Stock Exchange (NSE) Fact Book were involved in the study. Adopting the survey research design, questionnaire was administered on general managers, chief accountants, finance managers, and chief internal auditors of the selected firms as well as external auditors and tax administrators. Test re-test of the research instrument revealed very high reliability co-efficient. On account of this, the data generated were presented using tables, frequencies and percentages while the composite research hypothesis was tested regression and t-test analytical tools, aided by Software Package for Social Sciences (SPSS). The results was established a weak moderating influence while reaffirming the inverse relationship between taxation and return on investment. It is recommended that the efficiency-driven ideals of strategic financial management which imperatively underscore effective tax planning in order to justify all ensuing technology-related tax liabilities of agribusinesses for the ultimate sustainable diversification of the Nigerian economy.
The strides in information and communication technology (ICT) makes e-commerce a critical and inexorable feature of the global economy. In modern trend, significant numbers of transactions are consummated online. In Nigeria, it is no longer news that Central Bank of Nigeria (CBN) is promoting a ‘cash-less policy’ to drive development and modernation of our payment system in line with Nigeria’s version 2020 goal of being amongst the top 20 economies of the year 2020. This paper seeks to examine the tax framework to reflect the realities of modern transactions, establish a basis of taxation that arrests leakages and enables tax authorities to capture revenue that would otherwise have continued to leak. The researcher recommends the legal frame work of e-commerce taxation which has to be amended to reflect the global taxation principles of e-tax in our tax laws as a sovereign state so that investors and business carried on online should be taxed. Also that our tax policy and compliances to the regulatory authorities such as FIRS(Federal Inland Revenue Services)should be enforced on defaulting businesses, individuals and corporate entities as wells government agencies and departments to minimize tax evasion and avoidance.