TAX ANALYSIS AND REVENUE FORECASTING: A TIME SERIES APPROACH

Abstract

This study investigated tax analysis and revenue forecasting: a time series approach, with the purpose of finding out if tax revenue represented by Value Added Tax (VAT), Company Income Tax (CIT) and Customs and Excise Duties (CED) could affect economic development proxied by Human Development Index for the period of the study. The data were analysed using Multiple Regression Analyses in line with the research objectives of the study. The findings reveal that revenues collected by the federal government through CIT, VAT and CED have a positive relationship with Human Development Index. Based on the findings, it was concluded as follows: That revenues collected by the federal government through company income tax, value added tax, customs and excise duties help to improve the human development index of Nigeria. The study therefore recommends based on the findings that the federal government should sensitize tax payers on the need for tax payment and punishment for non-compliance. Furthermore, incentives should be provided to tax payers to encourage them (especially corporate bodies) to pay their taxes. Tax authorities should encourage tax education for its workforce in order to achieve the desired revenue drive.