Abstract:
This research looked at how tax revenue affected foreign direct investments (FDI) in Nigeria over a 21-year period, from 2000 to 2021. Time Series data from the CBN statistical bulletin, CBN annual reports, and the Federal Inland Revenue Service Annual Report were used in the analysis. Independent factors that were examined in relation to FDI were tax revenue as measured by the Petroleum Profit Tax (PPT), Corporate Tax (COT), Value Added Tax (VAT), Tertiary Education Tax (TEDT), and Custom and Excise Duties (CED). Descriptive statistics, correlation analysis, and multiple regression analysis were used on the dataset in E-VIEW version 9.0, and the results showed that PPT, COT, and VAT, had a significant effect on FDI, whereas TED) and CED do not. The results of the study indicate that tax income plays a crucial role in attracting foreign direct investment in Nigeria. It is suggested that the government invest tax money in essentials like reliable electricity and well-maintained roads. The result would be a reduction in the overall cost of doing business in the country, which would encourage more investment. As a result, domestic investment will rise, further contributing to GDP expansion.
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