Assessing the Effect of Tax Reforms on Federally Collected Revenue in Nigeria

This study examines the effect of tax reforms on federally collected revenue in Nigeria, focusing on the period from 2011 to 2023. It explores how key reforms such as the Value Added Tax (VAT), Petroleum Profit Tax (PPT), Company Income Tax (CIT), and National Information Technology Development Fund (NITDEF) have influenced government revenue generation. The research utilizes a Vector Auto Regression (VAR) model to analyze the interdependencies between these reforms and revenue collection, while addressing issues of tax evasion, inefficiency, and non-compliance. The findings reveal that VAT and CIT reforms significantly contribute to federal revenue, while PPT reforms show limited impact due to global oil price fluctuations. NITDEF reforms also exhibit a positive influence on revenue generation. The study suggests that the Nigerian government should prioritize VAT and CIT reforms, enhance digital tax administration, and expand the tax base to reduce dependency on oil revenue and ensure long-term fiscal sustainability. These insights have significant implications for future tax policy and economic development in Nigeria.