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Pattern of Spending and the Level of Tax Revenue in Nigeria

Author

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  • Audu, Solomon Ibrahim,

    (Dept. of Accounting and Finance, Caleb University, Lagos, Nigeria)

Abstract

This study examines the effect of spending pattern of the private and public sector on the level of tax revenue in Nigeria. Over a period of ten years (2009 to 2018), secondary data were obtained from the Central Bank of Nigeria statistical bulletin 2018 to extract data for the period covered by this study. The data were analyzed using a simple regression model. The result shows that public recurrent expenditure has a moderate relationship with the level of tax revenue in Nigeria and has more impact when compared with other independent variables (public capital expenditure or private household expenditure level). In conclusion, both government spending and household spending does not have a significant effect on the level of tax revenue in Nigeria. It is recommended that in order to boost the level of tax revenue in Nigeria, rather than the government increasing the consumption tax rate which will increase cost of living in Nigeria, the government should focus on promoting the manufacturing of goods locally to boost economic activities within the country from where taxes can be raised.

Suggested Citation

  • Audu, Solomon Ibrahim,, 2020. "Pattern of Spending and the Level of Tax Revenue in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(9), pages 561-567, September.
    • Handle: RePEc:bcp:journl:v:4:y:2020:i:9:p:561-567
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    References listed on IDEAS

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