Abstract

This study examined the effect of indirect taxes on economic growth ofNigeria, utilizing time series data spanning a 5year period, from 2014 to 2018. The data collected from secondary sources, were analyzed and tested for unitroot, using the Augmented Dickey-Fuller test. Consequently the study utilized the Error Correction Model to evaluate the impact of VAT, PPT and CED on the GDP. The findings revealed that VAT and PPT exert a positive and significant relationship on the GDP. It was also revealed that CED of twoperiod lags has a positive relationship with RGDP and VAT oftwo-period lags has a positive relationship with GDP and VAToftwo-period lagsshowing a negative but significant relationship with GDP. On the basis of thesefindings, it is recommended that some caution on the part ofthe government isrequired to identify all administrative loopholes for linkages to plug and tocontinue to maximize the contribution of VA T revenue to economic growth. Thisis important when it is realized that any action taken on VAT, as it relates to GDP will take a year to become effective while taking two years to slow downthe economy. In addition, and to achieve an optimum policy thrust, there must becommitment and honesty on the part of the agents of VAT and CED withrespect to its collection and payment; special remuneration, training andretraining ofthese agents, all in an attempt to enhance impact ofthese taxes onEconomic growth