Research Purpose: In the context of Nigeria's economic challenges, understanding the impact of tax structures on GDP is crucial for formulating effective fiscal policies. This study evaluates the effects of petroleum profit tax, corporate income tax, capital gains tax, and value-added tax on Nigeria’s gross domestic product (GDP) from 2011 to 2021.
Methodology: The study utilised data from the Federal Inland Service publications and the Central Bank of Nigeria statistical bulletin. Descriptive statistics and common regression analyses, including unit root tests and least square regression, were employed to determine the relationships between the variables.
Findings: The analysis revealed that value-added tax, petroleum profit tax, and corporate income tax positively and significantly impact economic growth. Conversely, capital gains tax negatively and insignificantly affects GDP. The independent variables collectively exhibit a strong and significant relationship with GDP.
Conclusion: The study concludes that value-added tax, petroleum profit tax, and corporate income tax are significant determinants of economic growth in Nigeria. These taxes are productive and reliable predictors of GDP in developing countries.
Recommendations: The study recommends that the government implement policies to enhance citizens' income, create employment, and ensure salary equity across government establishments. Additionally, a reformed tax system should be established to provide adequate revenue for public expenditures, reducing the need for fund-raising activities.
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