Tax Administration Reforms and Economic Growth in Nigeria: An Empirical Analysis of Post-2015 Policy Changes

This study examines the impact of tax administration reforms on economic growth in Nigeria, especially focusing on the policy changes that took place after 2015. The study uses an ex-post facto research design, drawing on annual time-series data from 2010 to 2024. The study adopted Autoregressive Distributed Lag (ARDL) model for data analysis. The findings indicate a long-term relationship between taxation and economic growth. Specifically, tax revenue components like TR, VAT, and CIT show positive and statistically significant effects on economic growth. The reform dummy variable suggests that the tax administration reforms implemented post-2015 have notably improved the effectiveness of taxation in fostering economic growth. Additionally, the error correction mechanism indicates a stable adjustment process towards long-term equilibrium. However, factors like inflation and exchange rate fluctuations were found to have limiting effects on growth. In conclusion, the study highlights that tax administration reforms in Nigeria have led to better revenue performance and have positively impacted economic growth, although there are still challenges in areas such as tax compliance and macroeconomic stability. To build on these findings, the study recommends enhancing digital tax systems, expanding the tax base, improving the efficiency of tax administration, and ensuring that tax revenue is effectively utilized.