Evaluating The Contributions Of Value Added Tax In Nigerian Economy: 1994 - 2018

ABSTRACT

This study assess the contributions and challenges of value added tax (VAT) to Nigerian Economic development. Specifically, the study examine the contribution of VAT to gross domestic product (GDP). Secondly, it analyse the effect of VAT on federal collected revenue. Thirdly, the study evaluate the influence of VAT on consumption of goods and services. Finally, the study investigate the opinion of tax personnel on challenges of VAT administration in Nigeria. Ex-post facto and survey research design was used for this study. The scope covers from 1994 when VAT started in Nigeria to 2018 the last available report. Secondary data were collected from Central Bank of Nigeria (CBN) statistical bulletin 2018. While the primary data was source from Federal Inland Revenue Service (FIRS) Umuahia. Simple regressions and one-sample t-test analysis methods were used to analyse and test the hypotheses. The analysis was perform with Econometrics View (Eview) 8 and Statistical Package for Social Sciences (SPSS) version 20. The result of this study shows that value added tax has significant impact on gross domestic product. Secondly, the study reveal that value added tax has significant contribution to Federal collected revenue. Thirdly, value added tax has no significant effect on consumption of goods and services in Nigeria. Lastly, the study shows that there exist significant difference in the opinion of the tax personnel on the challenges of value added tax administration in Nigeria.