Tax Structure and Economic Development: An Infrastructural Viewpoint

Authors

  • Okezie Uhuaba Department of Accounting, Babcock University, Ilishan Remo, Ogun State, Nigeria
  • Tunji Siyanbola Department of Accounting, Babcock University, Ilishan Remo, Ogun State, Nigeria https://orcid.org/0000-0003-0392-3022

DOI:

https://doi.org/10.52962/ipjaf.2020.4.2.101

Keywords:

Economic development, employment rate, infrastructure, tax base, tax structure

Abstract

Underdevelopment in Nigeria was attributed to the governments’ inability to invest in infrastructure, social inclusion, creation of jobs and youth empowerment, and improved the economy’s human capacity base. Therefore, this study examines Nigeria’s tax structure and economic development from the standpoint of infrastructural deficiencies. This study’s population consisted of 4,200 tax practitioners, senior management staff of the Federal Inland Revenue Service in Lagos State. Simultaneously, Taro Yamane’s formula was used to determine the sample size of 365. Cronbach Alpha reliability coefficients take values between 0.864 and 0.952, thus confirming the reliability of data used. The study employed a survey research design using a structured questionnaire administered to senior tax practitioners and senior staff of the Federal Inland Revenue Service. A total of 85% of the questionnaire administered were retrieved while descriptive and inferential statistics were used for the data analysis. The study found that the tax structure had a significant positive effect on infrastructure in Nigeria. The study recommended that investors critically and objectively study and understand the tax base dynamics and tax rates as they affect their taxable income from their investments.

Downloads

Download data is not yet available.

References

Adegbola, O., Nikollaos, P., & Ibe, S. (2018). The development of an infrastructure quality index for Nigerian metropolitan areas using multivariate geostatistical data fusion. Urban Science, 2(2), 1-19.

Akhor, S. O., & Ekundayo, O. U. (2016). The impact of indirect tax revenue on economic growth: The Nigerian experience. Igbinedion University Journal of Accounting, 2(2), 62-87.

Alade, S. O., & Tule, M. K. (2017). The Nigerian financial system at a glance. Central Bank of Nigeria Monetary Policy Journal, 1(2), 37-39.

Al-tarawneh, A., Khataybeh, M., & Alkhawaldeh, S. (2020). Impact of taxation on economic growth in an emerging country. International Journal of Business and Economics Research, 9(2), 73-77.

Amadi, K. C., Alolote, I. A. (2019). The nomenclature of taxation in Nigeria: Implication for economic development. Journal of International Business Research and Marketing, 4(1),1-12.

Anyafor, A. M. O. (1996), Public finance in a developing Economy – The Nigerian case. Banking and Finance publication, University of Nigeria, Enugu Campus, 2(2), 53-69.

Anyanwu, J. C. (2014). Monetary economics: Theory, policy and institutions. (3rd Ed). Onitsha: Hybrid Publishers.

Asaolu, T. O., Jayeola, O., & Oladele, A. S. (2018). Tax revenue and economic growth in Nigeria. International Journal of Management & Development, 5(7), 72-85

Babatunde, O. A., Ibukun, A. O., & Oyeyemi, O. G. (2017). Taxation revenue and economic growth in Africa. Journal of Accounting and Taxation, 9(2), 11-22.

Baiardi, D., Profeta, P., Puglisi, R., & Scabrosetti, S. (2019). Tax policy and economic growth: does it really matter? International Tax and Public Finance, 26 (2), 282-316.

Bhartia, H. L (2009). Public finance (14th Edition). New Delhi: Vikas Publishing House PVT Limited

Desislava, S. (2018). Tax structure and economic growth: Evidence from the European Union. Cortaderia Y Administration, 62(3), 1041-1057.

Egbunike, F. C., Emudainohwo, O. B., & Gunardi, A. (2018). Tax revenue and economic growth: A study of Nigeria and Ghana. Signifikan: Jurnal Ilmu Ekonomi, 7(20), 213 – 220.

Flossy, W. M., Makokha, E. N., & Namusonge, G. (2017). Effects of electronic tax system on tax collection efficiency in domestic taxes department of Kenya revenue authority, rift valley region. European Journal of Business and Management, 9(17), 50-58.

Folayan, D. O., & Adeniyi, A. G. (2018). Effects of tax evasion on government revenue generation in Oyo State, Nigeria. European Centre for Research Training and Development.

Gasteratos, I., Karamalis, M., & Koutoupis, A. (2016). Shadow economy worsens income distribution. International Journal of Economics & Business Administration, 4(3), 80-92.

Hadjimichael, F. M., Kemenyy, T., & Lanahan, L. (2014). Economic development: A definition and model for investment. Available from http://www.edu.gov/tool.

International Monetary Fund (IMF). (2016). The determinants of stock market development in emerging economies: Is South Africa different? IMF Working Paper, African Department, No 32.

Kanu. S. I, Ozurumba, B. A & Ihemeje, J. C. (2014). Examining the relationship between the Federal Government of Nigeria’s Revenue and Expenditure profiles. Journal of Economics and Sustainable Development, 1(2), 1-12.

Krugman, P. (2019). What is gross national income? (1st Ed.) Cambridge: Cambridge University Press.

Manggat, I., Zain, R., & Jamaluddin, Z. (2018). The impact of infrastructure development on rural communities: A literature review. International Journal of Academic Research in Business and Social Sciences, 8(1), 647–658.

Mbanefoh, A. (2012). Principles of taxation, International Journal of Academic Research in Business and Social Sciences, 5(6), 34-43.

Michael, P., Todaro, C., & Stephen, S. (2012). Economic development, (11th Ed.), B. Higgins. Op City, New York.

Nedozie, F. O., Obasanmi, J., & Ighata, J. A. (2014). Infrastructural development and economic development in Nigeria using simultaneous equations. Journal of Economics, 5(3), 325-332.

Obafemi, F. J. (2014). An empirical study of tax evasion and tax avoidance: A critical issue in Nigeria’s economic development. Journal of Economics and Sustainable Development, 5(18), 22-26.

Ofoegbu G. N., Akwu. D. O & Olive. O. (2016). Empirical analysis of effect of tax revenue on economic development of Nigeria. International Journal of Asian Social Science, 6(10), 604-613.

Ogbuagu, U. R., Ubi, P. S., & Effion, L. (2014). Corruption and infrastructural decay, perceptible evidence from Nigeria, Journal of Economics and Sustainable Development, 5(10), 20-27.

Olufemi, E. A., Olatunbosun, A. J., Olsode, O. S., & Adeniran, I. G. (2013). Infrastructure development and its effect on economic growth: The Nigerian perspective. European Scientific Journal, 9(31), 431-452.

Onaolapo, S. Aworemi, E. I., & Ajala, K. (2013). Impact of value-added tax on revenue generation in Nigeria, Quarterly Journal of Economics, 122(19), 729-773.

Olaoye, S. A., & Aguguom, T. A. (2018). Tax incentives as a catalyst of Tax Compliance for Tax revenue and Economic development: Empirical evidence from Nigerian. European Journal of Accounting, Finance and Investment, 1(8), 001-014.

Olaoye, S. A., & Aguguom, T. A. (2017). A tax base erosion and profit shifting through transfer pricing: Evidence from Nigeria. Journal of Business Administration and Management Sciences Research, 6(1), 001-012.

Owusu-Gyimah, A. (2015). Tax revenue generation and the economic development of Ghana. European Journal of Business and Management, 7(14), 78-88.

Oyedele, O. A. (2012). The challenges of infrastructure development in democratic governance. Proceedings of the Construction Economics and Management, 1(1), 1-15.

Schultz, T. W. (2019). Human capital formation. International Business Journal, 2(3), 234-242.

Sullivan, A., & Sheffrin, M. S. (2013). Economics: Principles in action. (2nd Ed) Upper Saddle River, New Jersey: Pearson Prentice Hall.

Thaci, L., & Gerxhaliu, A. (2018). Tax structure and developing countries. European Journal of Economics and Business Studies, 4(1), 213-220.

Yan, W. (2012). The impact of revenue diversification and economic base on state revenue stability. Journal of Public Budgeting, Accounting & Financial Management, 24(1), 58-81.

Downloads

Published

2020-04-01

Issue

Section

Main Section

How to Cite

Tax Structure and Economic Development: An Infrastructural Viewpoint. (2020). Indian-Pacific Journal of Accounting and Finance, 4(2), 14-23. https://doi.org/10.52962/ipjaf.2020.4.2.101

Similar Articles

1-10 of 58

You may also start an advanced similarity search for this article.