Title: Value Added Tax (VAT) and Economic Development in Nigeria
Authors: Dosumu, Adeolu Modupe, Amusa, Amidu Ajani, Folayan, Olubukola Aina
Volume: 9
Issue: 7
Pages: 85-91
Publication Date: 2025/07/28
Abstract:
This study examined the influence of VAT on economic development. Descriptive Survey research design was employed. The sample chosen for this study was a non probability sampling. The sample size comprises of the VAT and the GDP. Secondary data was employed for the study. Data on VAT, Real Gross Domestic Product (RGDP) and federally collected revenue in Nigeria over a period of five years, i.e 2018-2022 were retrieved from the Statistical Bulletin of Federal Inland Revenue and National Bureau of Statistics (2018-2022). Two hypotheses formulated to guide the study were tested at 0.05 level of significance. Statistical Package for Social Sciences (SPSS) was used to analyse the data. The study found a positive and significant influence of VAT on revenue generation, Gross Domestic Product (GDP) and economic development in Nigeria (p. value < 0.05). The study recommended among others that, new local VAT offices should be established all over the country to broaden the tax base and to bring VAT administration closer to the taxpayer, Government should strengthen tax administration to ensure more efficient tax collection, through training of staff, awareness campaigns and computerization of customs tariff; Government should use VAT proceeds to improve on the standard of living of the populace and improve on infrastructures such as transport, power, communication and information technology so as to strengthen the productive capacity and motivate taxpayers in paying their taxes.