Journal of Accounting and Taxation
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Article Number - 0A7FBCA61224


Vol.8(6), pp. 59-65 , November 2016
DOI: 10.5897/JAT2016.0226
ISSN: 2141-6664



Full Length Research Paper

Evaluating the impact of value added tax on the economic growth of Nigeria



Nasiru Mukhtar Gatawa
  • Nasiru Mukhtar Gatawa
  • Department of Economics, Usmanu Danfodiyo University, Sokoto, Nigeria.
  • Google Scholar
Haruna Mohammed Aliero*
  • Haruna Mohammed Aliero*
  • Department of Economics, Usmanu Danfodiyo University, Sokoto, Nigeria.
  • Google Scholar
Abdullahi Muhammad Aishatu
  • Abdullahi Muhammad Aishatu
  • Department of General Studies, Federal Polytechnic Bida Niger State, Nigeria.
  • Google Scholar







 Received: 26 June 2016  Accepted: 19 September 2016  Published: 30 November 2016

Copyright © 2016 Author(s) retain the copyright of this article.
This article is published under the terms of the Creative Commons Attribution License 4.0


The Nigerian tax reform in the early 1990s was a fallout of market reform in the mid- 1980s, while the structural adjustment program (SAP) piloted a transition to market driven economy where emphasis is laid on market forces with minimal government intervention, hence, the introduction of Value Added Tax (VAT) in 1994. This study empirically examined the impact of VAT on the level of economic activities in Nigeria from its inception to 2014. The study uses secondary data which was analyzed using Johansen (1988) co-integration test. The quarterly data ranged from 1994 Q4 to 2014 Q4. The study found evidence of a significant positive impact of VAT on economic growth. In the same vein, other government revenues, which include all oil receipts and other receipts into the federation account other than VAT were also found to be positively related to economic growth during the study period. The study, therefore, recommends that VAT should be sustained hence; all identified administrative loopholes should be covered for VAT revenue to continue to contribute more significantly to economic growth of the country. There should also be accountability and transparency in the management of all sources of government revenue.

Key words: Value added tax, economic growth, Gross Domestic Product (GDP), other government revenue, Nigeria.

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APA Gatawa, N. M., Aliero, H. M., & Aishatu, A. M. (2016). Evaluating the impact of value added tax on the economic growth of Nigeria. Journal of Accounting and Taxation, 8(6), 59-65.
Chicago Nasiru Mukhtar Gatawa, Haruna Mohammed Aliero and Abdullahi Muhammad Aishatu. "Evaluating the impact of value added tax on the economic growth of Nigeria." Journal of Accounting and Taxation 8, no. 6 (2016): 59-65.
MLA Nasiru Mukhtar Gatawa, Haruna Mohammed Aliero and Abdullahi Muhammad Aishatu. "Evaluating the impact of value added tax on the economic growth of Nigeria." Journal of Accounting and Taxation 8.6 (2016): 59-65.
   
DOI 10.5897/JAT2016.0226
URL http://academicjournals.org/journal/JAT/article-abstract/0A7FBCA61224

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