FEDERAL GOVERNMENT TAXES AND INFRASTRUCTURAL DEVELOPMENT IN NIGERIA

Abstract

The study determined the relationship between federal government taxes and infrastructural development in Nigeria. The study employed ex-post facto research design. The population of this study was the entire Nigerian economy where the elements of the data used for this research were extracted. Using judgmental sampling technique, a sample of 33 years’ period were used. However, relevant data for the study were obtained from Central Bank of Nigeria (CBN) Statistical Bulletins and Federal Inland Revenue Services Bulletins. Regression analysis technique was used to measure the effects of the predictor variables on the criterion variables. The regression analysis revealed a significant relationship between health infrastructure (HI) and petroleum profit tax (PPT), company income tax (CIT), and value added tax (VAT). The results also showed that the independent variables (PPT, CIT, and VAT) did not significantly explain the variation in Transport Infrastructure. The results also showed that PPT is a statistically significant and positive predictor of PI, while VAT may have a marginally significant negative effect. The results finally suggest that government policy significantly influences federal taxes and ID, explaining a significant portion of the variance. The investigator thus concluded that there is a significant relationship between federal government taxes and infrastructural development in Nigeria. Consequently, the researcher suggested that policymakers and authorities should allocate a portion of PPT revenue towards health infrastructure projects, enhancing healthcare facilities, equipment, and services, ultimately enhancing population well-being. Further research should explore additional factors like public funding, private investments, regional demographics, and policy measures to better understand the impact of transport infrastructure development. Policymakers should create incentives for petroleum industry companies to invest in power infrastructure projects, as PPT is a significant predictor of PI, improving regional power supply and distribution. Government policymakers should consider the impact of federal taxes and infrastructural development on economic development, as targeted policies can promote growth, increase revenue, and stimulate infrastructure.