Research Objective: This study investigates the impact of government levies on Nigeria's economic development, focusing on consumption tax, corporate income tax, and other relevant indexes.
Methodology: An ex-post facto research design was employed, analysing seven indexes to determine their effects on Nigeria's Gross Domestic Product (GDP) and Human Development Index (HDI).
Findings: The study revealed that corporate income tax significantly and positively impacts GDP (β = 0.711287, p < 0.05) but has a non-significant negative effect on HDI (β = -0.070596, p > 0.05). Petroleum profit tax showed a positive yet non-significant impact on both GDP and HDI. Conversely, consumption tax negatively influences GDP (β = -0.212366, p < 0.05) and has a non-significant negative effect on HDI.
Conclusion: Government levies, particularly corporate income tax and consumption tax, play a critical role in shaping Nigeria’s economic development. However, their effects on GDP and HDI vary significantly.
Recommendations: The study recommends increasing consumer tax rates, reinvesting tax revenues into GDP and HDI improvements, and allocating petroleum profit tax funds to public welfare programs to foster balanced economic development.
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