Causality Between Valued Added Tax (VAT) and Nigerian Economy: An ECM Approach
Journal: International Journal of Economics and Financial Research (Vol.4, No. 7)Publication Date: 2018-07-15
Authors : Nwaoha William Chimee; Onwuka Onwuka Okwara; Ejem Chukwu Agwu; Ogbuewu Kalu James;
Page : 226-234
Keywords : VAT; GDP; ECM; CBN.;
Abstract
This study used error correction model (ECM) to analyse the causality between Value Added Tax (VAT) and the Nigerian Economy proxied by GDP during the period 1994-2015. The data such as VAT and GDP were obtained from Central Bank of Nigeria (CBN) statistical bulletin and Federal Inland Revenue Services (FIRS). The results of the findings revealed that VAT exerts positive and significant influence on GDP while there was evidence of unidirectional causality running from VAT to GDP. Therefore, the researchers recommend that in order to enhance economic growth of Nigeria through VAT revenue, there is need to plug all the lapses identified in tax administration and educate the tax administrators as well as the entire populace on the relevant of VAT revenue to the economy.
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Last modified: 2018-11-06 18:10:42