PETROLEUM PROFIT TAX AND ECONOMIC GROWTH IN NIGERIA (Published)
The fundamental objective of this study was to investigate the relationship between Petroleum Profits tax and economic growth in Nigeria, against the backdrop of the monumental losses from tax evasion and avoidance in the petroleum upstream sector. The study spanned a period of 32 years from 1980 to 2011. Annual time series taxation and macroeconomic data were collected from the Federal Inland Revenue Service, Central Bank of Nigeria Statistical Bulletin and Federal Office of Statistics. A combination of co-integration and error correction estimation techniques were employed in the study. In addition, we ran a couple of diagnostic tests to check the adequacy of the specified model. As expected, Petroleum Profits tax was found to have a statistically significant positive relationship with real GDP growth rate having reported a positive coefficient of (4.64) and a robust t-value of (2.30). Total direct tax, with a positive coefficient of (4.19), and a t-value of (2.48), was also found to have positive impact on economic growth in Nigeria. Openness was found to have a negative and insignificant impact on economic growth having reported a negative coefficient of (-0.01), and t-value of (-0.15). Against the backdrop of the findings, we recommended that all companies in the petroleum upstream sector should be listed in the Nigeria Stock Exchange for transparency of transactions and accountability which would eventually translate rate increased revenue
Keywords: Co-integration, Economic growth, Openness, Petroleum profits tax, Resource rent rate, Stationarity, Total direct tax
IMPACT OF FISCAL POLICY ON THE MANUFACTURING SECTOR OUTPUT IN NIGERIA: AN ERROR CORRECTION ANALYSIS (Published)
There has been a growing concern on the role of fiscal policy on the output and input of manufacturing industry in Nigeria, despite the fact that the government had embarked on several policies aimed at improving the growth of Nigerian economy through the contribution of manufacturing industry to the economy and capacity utilization of the sector. The aim of this study is to examine the impact of fiscal policy on the manufacturing sector output in Nigeria. Empirical evidence from the developed and developing economies has shown that fiscal and monetary policies have the capacity to influence the entire economy if it is well managed.An ex-post facto design (quantitative research design) was used to carry out this study. The results of the study indicate that government expenditure significantly affect manufacturing sector output based on the magnitude and the level of significance of the coefficient and p-value and there is a long-run relationship between fiscal policy and manufacturing sector output. The implication of this finding is that if government did not increase public expenditure and its implementation, Nigerian manufacturing sector output will not generate a corresponding increase in the growth of Nigerian economy. It is the recommendation of researcher that the expansionary fiscal policies should be encouraged as they play vital role for the growth of the manufacturing sector output in Nigeria; that fiscal policy should be given more priority attention towards the manufacturing sector by increasing the level of budget implementation, which will enhance aggregate spending in the economy; and consistent government implementation will contribute to the increase performance of manufacturing sector.
Keywords: Co-integration, Error correction model, Government expenditure, Government tax revenue, Manufacturing sector, Output, capacity utilization
