Author(s): Ugherughe Joseph Ediri, Ewiwile Stephen, Egugbo, Rita Uzoma, Oghoghomeh Tennyson
The study examined the impact of tax revenue on the Nigerian economy. The study used gross domestic product as the dependent variable and the tax revenue – company gains tax, customs and import duties, companies’ income tax, petroleum profit tax, and value added tax as independent variables. The results of the ordinary least squares show the positive and the negative insignificant impact of the independent variables on the dependent variable. The coefficient of determination, R2 (0.966598) shows that the estimated model has predictive power and the Durbin-Watson statistics (i.e. 1.700733, approximately 2) indicate the absence of serial autocorrelation in the estimated model. The Pairwise Granger causality test shows that there is the unidirectional causal relationship between all the tax revenue and the Nigerian economy. The study, therefore, concludes that tax revenue is a source of income to fill the gap for non-tax revenue in the long-run.