This study examined the impact of tax revenue on economic growth.

A post hoc survey design was chosen for this study. The Central Bank of Nigeria (CBN) and the Federal Inland Revenue Service (FIRS) were for research purposes. The data used in this study were primarily obtained from secondary sources. This study used quantitative methods of data analysis and the following he was carried out in four directions.
First, we performed descriptive analysis using Jarque-Berra statistics mean, maximum, minimum, skewness, kurtosis, and probability.

The results of the regression analysis show that the oil profit tax and customs and excise tax were not statistically significant at the 5% significance level. This means that the irregular fluctuations in these earnings do not contribute significantly to the formation of gross fixed capital. This is why infrastructure development is expected in the same way that his VAT and corporate income tax had a significant impact on economic growth during the reporting period. This can be attributed to the continuous and steady increase in the value of revenue from this area.

The study concludes that federally collected revenue has significant role in government decision to invest in infrastructural development. Te study ereby recommends tdat; There should be stringent penalty imposed on any individual or corporate body who indulge in any form of tax malpractices irrespective of states; Efforts should be intensified by the government towards increased collection of tax revenue this is due to the low contribution of tax revenue to GDP over the period of study; Government should be able to use taxpayers’ monies in the provision of infrastructural facilities.




Infrastructure is very significant to a country’s developmental prospect, the adequacy of infrastructure may determine a country’s success of failure in diversifying production, coping with population growth, reducing poverty, improving welfare of citizens (Mobolaji & Wale 2012). One of The major roles of any government particularly in developing countries such as Nigeria is the provision of infrastructural services like effective roads, power supply, telecommunication, good education, health services, pipe-borne water as well as to ensure an increase in per capita income, reduction in poverty rate to mention a few, for these services to be sufficiently made available, the government must have sufficient revenue to finance them. Funding these services is a big problem for governments.

In Africa, research shows that there is a lack of infrastructure that hinders the growth and development of the continent.

Revenue generation is the central path to modern development. Recently, revenue mobilization has become essential in developing countries, and this is a key condition that governments need adequate funding. Nigeria was an agricultural economy with income primarily based on agriculture. This was before Britain discovered oil in the Niger Delta in the late 1950s (Onaolapo, Fasina & Adegbite, 2013). The volatility of oil prices, globalization and the supply and demand of oil are forcing the Nigerian government to look for other sources of income. One of these sources is taxes.

Taxation has become an important source of revenue for governments because of its consistency (Anyaduba & Wale 2015). Taxation existed in Nigeria before the arrival of colonial rulers or the British (Samuel & Tyokoso 2014). According to Oriakhi (2013), tax revenue has contributed to the revenue collected by the federal government since independence. Taxes are seen as a burden that must be borne by all citizens in order to maintain the government, as it has specific functions that the government performs for the benefit of the people it governs (Afuberoh & Okoye 2014). ).

The first traces of any form of direct taxation in Nigeria were in northern Nigeria, before the British government. The North was favored for this because it had a sort of organized central administration under a chief, in contrast to the South, which was unorganized except in a few places in the West. In 1904, the late Sir Lugard introduced an income tax in Nigeria. It began as a local tax, which he later culminated in the Indigenous Revenue Act of 1917. In 1918, an amended ordinance extended the provisions of his 1917 ordinance to southern Nigeria. The first ordinances applied to Abeokuta in Ogun State and the city of Benin in Edo State, and in 1928 to Eastern Nigeria. Income taxation in Nigeria only began in his 1940s when direct taxation was incorporated into the Indigenous Revenue Acts of 1917, 1918 and 1928.

Compliant with Cap Ordinance No. 4 of 1940. Native Peoples Ordinance Cap 74 of 1923 and Native Peoples Direct Taxation (Colonies) – Ordinance No. 41 of 1937 is repealed. However, this ordinance was discriminatory as it applied to indigenous peoples elsewhere in Nigeria, namely outside Lagos City. No. 29 regulated the valuation of income for non-African residents outside Lagos, and for African and non-African residents living in Lagos. . After the Income Tax Ordinance of 1943, there were no major changes to the tax system until 1956.

However, the northern region did not pass its own income tax law until 1962 when he did. All local tax laws formed the basis for income taxes in all states that later emerged from the region. In the Lagos Federal Territory, the Income Tax Act 1943 was in effect until the federal government enacted his Individual Income Tax (Lagos) Act 1961. It was his 1961 statute that created a separate law governing the income and profits of both individuals and businesses, namely the Income Tax Administration Act (ITMA). and the Corporate Income Tax Act (CITA). The Oil Profit Ordinance was passed in 1959 but came into force on 1 January 1958. To date, a large number of tax laws have been enacted in Nigeria.

Despite the amount of money the government generates from tax revenue, development in Nigeria remains an illusion. Poverty, low standards of living and unemployment are still very high.

1.1 Problem Description

Infrastructure development is the cornerstone of good democratic governance and the country has a history of infrastructure decline. The state of a country’s infrastructure is directly related to its quality of life (Olufemi 2012). “According to the latest statistics, the quality of life for most people in Africa appears to have either not improved at all, or improved only marginally. and most of them led the struggle for independence” (Eregha 2007). A country cannot develop without infrastructure. Studies show that Nigeria’s infrastructure was inadequate to support industrial development. Housing facilities are in a dire state, roads are frequent with traffic accidents, poor condition of general hospital buildings and facilities, lack of medicines, poor education, universities continue to use old and outdated facilities. increase. , electricity is inadequate to support economic development, businesses close and some migrate to other countries.

Taxation is a deployed stabilizing weapon

1.2 Purpose of the survey

The main purpose of this study is to assess the impact of tax revenues on infrastructure development in Nigeria.

Specific goals are:

I. Assess the impact of the oil profits tax on infrastructure development in Nigeria.

II. Access the impact of corporate tax on infrastructure development in Nigeria. III. Determine the impact of VAT on infrastructure development in Nigeria.

IV. Accessing the Impact of Tariffs and Excises on Infrastructure Development in Nigeria.

1.3 Research question

Me. What impact will the oil profit tax have on infrastructure development in Nigeria?

ii. How does corporate tax affect infrastructure development in Nigeria?

iii. To what extent does the VAT affect infrastructure development in Nigeria? IV. What impact will tariffs and excise taxes have on infrastructure development in Nigeria?

1.4 Research hypothesis:

Hypothesis 1

The oil profits tax will not have a significant impact on Nigeria’s infrastructure development.

Corporate tax does not have a significant impact on infrastructure development in Nigeria.

There is no significant link between VAT and infrastructure development in Nigeria. Ho4:
Tariffs and excise taxes have not had a significant impact on Nigeria’s infrastructure development.

1.5 Importance of research

Tax revenue is one of the government’s sources of revenue, promoting socioeconomic development by balancing the balance of payments, redistributing income, providing social benefits, combating poverty, and combating recession, inflation, or deflation. used for

This research will help the federal government to ensure quality tax administration and develop an effective policy framework that promotes the country’s development.

The study will also help governments know how to generate revenue from taxes instead of relying solely on oil sector revenues.

Policy makers at the national level will find this research important when designing strategies aimed at stimulating economic growth and infrastructure development through better tax systems. This study is intended to educate and guide individuals, organizations, students, and other academics who wish to pursue further study and research in taxation.

1.6 Scope of investigation

The scope of this study includes the impact of tax revenue on infrastructure development in Nigeria over a 24-year period (1994-2017). The evolution of oil profits tax, corporate income tax, value added tax, customs duty and excise tax have been studied over the period to determine their correlation with infrastructure development in Nigeria. The focus was based on data collected from the Federal Internal Revenue Service (FIRS).

Her three main levels of government:
Federal, state and local governments are responsible for collecting taxes in Nigeria. The federal government uses the Federal Internal Revenue Service (FIRS) to process taxes paid by corporations and the Federal Capital Territory. As part of this study, we explored the federal tax imposed by the government and its contribution to infrastructure development in the Nigerian economy.

1.7 Working with variables

The purpose of this study was to examine the impact of tax revenue on infrastructure development in Nigeria.

To accomplish this, two variables were identified in this study. These are the independent and dependent variables. The independent variable is tax revenue generated in Nigeria and the following dimensions are used as proxies:
Corporate Income Tax (CIT), Petroleum Profit Tax (PPT), Customs and Excise Duty (CED), Value Added Tax (VAT). On the other hand, the dependent variable is Nigeria’s infrastructure development.

The following models were adopted



Y = y1, y2, y3, y4


Y= Infrastructure Development (ID)

y1= street and house (RH)

y2= Healthcare (HC)

y3= Education (ED)

y4= power (PW)

X= Federal Tax Collected (FCT)

x1= Corporate Income Tax (CIT)

x2= Petroleum Profit Tax (PPT)

x3= Value Added Tax (VAT)

x4= Customs Duty and Excise (CED)

functional relationship

ID=f (CIT)………………..1

ID=f (PPT)………………..2

ID=f (VAT)……………….3

ID=f (CED)……………….4

ID= f (CIT, PPT, CED, VAT)…………5

The above functional relationship is the basic function of tax revenue impact on Nigeria’s infrastructure development.

1.9. Definition of Factory Terms


Nightingale (1997) describes taxes as compulsory tax collections imposed by the government, in which taxpayers receive no discernible return for their contributions, yet are relatively educated, healthy and safe. It concludes that there are advantages to living in society.


Taxation is defined as the process of collecting and collecting taxes from taxpayers.

Nigerian tax authorities:

This refers to federal revenue collection agencies represented by the Federal Internal Revenue Service (FIRS), State Internal Revenue Service (SIRS), and Local Government Revenue Boards.

Infrastructure development:

One of the main tasks of all governments, especially in developing countries like Nigeria, is to provide infrastructure services such as efficient roads, electricity, telecommunications, adequate education, medical services, water supply, etc., and to increase per capita income. sure to increase your income. Reduce poverty rates.


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