COMPANIES INCOME TAX VOLATILITY AND ECONOMIC GROWTH IN NIGERIA

Abstract

This paper argued that economic growth is a progenitor of steady revenue generation through company income tax. The contradiction as evident in Nigeria is a derivative of less focus on income from taxes. Hence, the investigation of companies’ income tax volatility and economic growth in Nigeria from 1981-2017. Ex post facto research design was adopted. Data were obtained from certified sources;National Bureau of Statistics, Central Bank of Nigeria Statistical Bulletin and Federal Inland Revenue Services. Data were exposed to legal scrutiny by the appropriate regulatory agencies for validity and reliability. Data were analyzed using both descriptive and inferential statistics. Findings revealed that company income tax volatility had positive and significant effect on economic growth in Nigeria (R 2= 0.55, β1 = 0.348, t(107) = 2.524, p<0.05). This study concluded that companies’ income tax volatility affected economic growth. It was recommended that government should implement tax-friendly policies to encourage tax payment in order to boost tax revenue and channel such funds to developmental activities.