Universal Journal of Accounting and Finance Vol. 9(6), pp. 1355 - 1365
DOI: 10.13189/ujaf.2021.090614
Reprint (PDF) (315Kb)


Causality Analysis of Non-oil Tax Component of Government Revenue, Company Income and Transaction Taxes: Evidence from a Third World Developing Economy


Orits Frank Ebiaghan , Edirin Jeroh *, Abel Oghenevwoke Ideh
Department of Accounting and Finance, Delta State University, Abraka, Nigeria

ABSTRACT

Overtly, the colossal infrastructural deficit occasioned by the ever increasing population of Nigeria requires sizeable revenue strings if they must be copiously addressed. Largely, the country has over time relied on oil revenue to carry-out her sacred duty of welfare and security provision along with efforts targeted at guaranteeing freedom of her citizenry amongst others. With the recent global drop in oil prices, there has been a general call for government to reinforce other channels of revenue generation so that the country can weather the tides of economic turmoil. This however calls for an understanding of the interrelatedness of various components of accruable revenue to the government through a causality study of such revenue components. This study thus focuses on a causality analysis of non-oil tax component of government revenue, company income and transaction taxes by obtaining empirical evidence from a third world developing economy – Nigeria. Time series data for 15 years were analysed based on the study's intent and with the use of relevant statistics like the unit root tests, chow test, granger causality test, least square and auto regressive regression analysis. Our study's outcome proved that while federally generated revenue proved to have been significantly improved by revenue from income taxes and stamp duties, the tax policies and their subsequent amendments could not exert significant influence on non-oil tax revenue of government during the period. On this note, we recommend the need for effective policy pertaining to Stamp Duties and Companies' Income Tax (CIT) along with a marginal reduction in tax holidays of companies to the extent that the Stamp Duties' Act (SDA) is fully enforced/implemented vis-à-vis strict penalties for non-compliance. Outcome from this research has policy implications which stand to benefit regulatory bodies/policy makers, tax consultants, academics and key stakeholders as it presents key issues relating to CIT, SDA, and non-oil revenue of Nigeria's government.

KEYWORDS
Taxes, Government Revenue, Tax Holiday, Ad Valorem, Developing Nations, Transaction Tax, Nigeria

Cite This Paper in IEEE or APA Citation Styles
(a). IEEE Format:
[1] Orits Frank Ebiaghan , Edirin Jeroh , Abel Oghenevwoke Ideh , "Causality Analysis of Non-oil Tax Component of Government Revenue, Company Income and Transaction Taxes: Evidence from a Third World Developing Economy," Universal Journal of Accounting and Finance, Vol. 9, No. 6, pp. 1355 - 1365, 2021. DOI: 10.13189/ujaf.2021.090614.

(b). APA Format:
Orits Frank Ebiaghan , Edirin Jeroh , Abel Oghenevwoke Ideh (2021). Causality Analysis of Non-oil Tax Component of Government Revenue, Company Income and Transaction Taxes: Evidence from a Third World Developing Economy. Universal Journal of Accounting and Finance, 9(6), 1355 - 1365. DOI: 10.13189/ujaf.2021.090614.