TAX EVASION AND ECONOMIC GROWTH IN NGERIA

Abstract

The study examined the effect of tax evasion on economic growth in the Nigerian economy between the periods of 2010 to 2021. The objective of this study was to determine the impact that the evasion of tax has on the economy growth which was proxy by the Gross domestic Product (GDP). The ex-poste research design was adopted for the study, wherein secondary data were sourced from the national bureau of statistics annual bulletin. The Augmented dickey fuller test was used to determine the level of stationarity of the variables and the study showed that all variables have mixed stationary levels f I(0) and I(1). Multiple regression analysis and the Pearson Product Moment Correlation (PPMC) was conducted in order to achieve the objectives of the study. The study thereby revealed that tax evasion has a positive and significant impact on economic growth while a negative relationship exist between tax revenue and economic growth. The study concluded that tax evasion exerts a positive and significant impact on economic growth and it was recommended that the fiscal authorities should ensure that the administration of tax rules and payment of tax is made more lenient in order to increase tax compliance in the country