government expenditure a nd taxes, affects the output by influencing the aggregate e conomic activity. In addition, money collected as a result of charging taxes always fall short of government expenditure necessitating the need for the government to borrow money. Likewise, recurrent expenditure had a negative and significant effect on economic growth. Acces PDF Effects Of Income Tax Changes On Economic Growth Effects Of Income Tax Changes On Economic Growth When people should go to the books stores, search initiation by shop, shelf by shelf, it is in point of fact problematic. The effects of income taxation in the context of a two-sector endogenous growth model have been examined before by many au-thors. • The test also revealed that, in the long run, development expenditure had a positive and significant effect on growth rate while income tax had a negative impact. A number of studies indicated mixed results for the effect of taxes on economic growth. Effects of Taxation on Production: Taxation can influence production and growth. The Centrality of Taxation to Economic Development and Poverty Reduction Awell-functioning revenue system is a neces-sary condition for strong, sustained and inclu-sive economic development. At the contemporary periods, Ethiopia’s economic growth transformed from single to double digit. Economic effects of taxation can be studied under the following headings: 1. effects. The broad objective of this study is to examine the effect of taxation on economic growth of Nigeria. The study examined the relationship between taxation and the economic growth of Nigeria. Part I of this document discusses four principal determinants of economic growth that tax policy may be able to influence. The effects of environmental taxation on economic growth are a contro-versial issue. Because capital income is so unequally distributed, lowering business and investment tax rates creates an upward income redistribution, enriching the already-wealthy. In June 2001 President George W. Bush signed the Economic Growth and Tax Relief and Reconciliation Act into law, initiating a multi-year program of reductions in taxes on individual income. 1.1.3 Nexus between taxation and economic growth According to Muriithi (2013) and Siddiqi and lllyas (2010) a tax impacts economic growth by generating revenue to meet its various governmental needs. 2. Corporate taxes are found to be most harmful for growth, followed by personal income . An Emperical Analysis of Tax Revenue and Economic Growth in Nigeria from 1980 to 2015 By Abomaye-Nimenibo, Williams Aminadokiari Samuel, Michael Jack Eyo, Mni & Friday, Hope Chika. According to econ-omists, environmental taxes have a negative effect on economic performance (Roegen, 1971; Meadows et al., 1972; Daly, 1991). Some reforms of tax and transfer systems entail a double dividend in terms of reducing inequality and raising GDP per capita. The second is to . Summary Economic growth is the term for steady growth in the production of the economy. Tax systems are primarily aimed at financing public expenditures. The first approach is to examine the historical record of the U.S. economy to evaluate whether tax cuts have been associated with economic growth. Explicit modelling of the individual decisions that contribute to growth allows the analysis of tax incidence and the prediction of growth effects. The paper has four sections, including this Introduction. increases raise serious questions about the effect taxation has upon economic growth. The specific objectives are as follows: 1. The Impact of Taxation on the Economic and Social Development in Nigeria. Where taxes can affect t he growth through five ways; increase ta xes can discourage. ofobuike65@yahoo.com Ibeanu Rita Ijeoma Advanced Space Technology Application Laboratory University of Uyo, Akwa Ibom State Using secondary data gotten from the CBN statistical bulletin with the help of regression as a statistical tool, we analyzed the postulated hypothesis which . 1 As in most of Also crude oil production had a negative but significant effect on economic growth and other variables. The project titled effect of taxation on economic development in Nigeria is aimed at determining the nature of taxation and contribution of taxation towards the economic growth of Nigeria and its impact if properly used. Tax reforms are sometimes touted to have strong macroeconomic growth effects. The main problem was that while the government uses taxes as a means to generate revenue they in turn generate both positive and negative impacts to the economy. Tax reforms are sometimes touted as having strong macroeconomic growth effects. impact than direct taxation on economic growth of the discussed provinces; this is an essential part of this study. Taxation is important mechanism that boosts country’s economic level. The study recorded a decline in shares of payroll, goods and services and positive growth from personal and property taxes. impact on economic growth [20]. The main variable of this study is growth and the growth rate of real GDP per capita. Whereas direct tax impacts directly the disposable income, the indirect tax impacts the prices of goods and services in the market. In this research, variables of economic growth, direct taxation, labor, government expenditures, taxation on petroleum products and inflation, resulted from Okoh, et al., (2016) review, Thus the emphasis on taxation by one and all cannot be over emphasized though is . ABSTRACT The aim of this paper is to judge the impact of individual styles of taxes on the economic process by utilizing multivariate analysis on the OECD countries for the period of 2000 - 2011. IMPACT OF TAX REVENUE ON ECONOMIC DEVELOPMENT IN NIGERIA (1997- 2018) Dr Awa Felix N. Department of Accountancy Ebonyi State University, Abakaliki, Nigeria. In January 2003 President Bush approved the Jobs and Growth Tax Relief Reconciliation Act of 2003, substantially cutting taxes on business income. This paper explores the likely effects that changes on the tax code will have on economic activity. Moussavou (2017) shows that the State's revenues exert a positive influence on Congolese economic growth over the period 1980 to 2015. This can lead to economic growth and development. This the effects of (capital) income tax on growth and sectoral labor distri-bution. In terms of the impact on economic growth, we considered the possibility that the average burden of tax - as measured by the three Paying Taxes measures over the period 2004 to 2011 - might have had a negative impact on the rate of economic growth. The study employed an endogenous growth model that was first employed by Egen and Numerous of these studies found a negative relationship, others found that taxes affect economic growth positively. Economic growth is an increase in the capacity of an economy to produce goods and services . more growth than a potential reduction in tax rate. deciding parameter for economic growth. These results are consistent with Yamazaki (2017) analysis of the employment effects of the British Columbia carbon tax. 2. The growth rate can be influenced by economic policy choice relative to Keywords: taxpolicy,taxadministration,tax reform, developing countries, fiscal policy 1. Revenue funds Cutting taxes for the owners of businesses and other forms of capital rarely had perceptible effects on investment or economic growth, but these cuts still have economic effects. Tax systems are also used to promote other objectives, such as equity, and to address social and economic concerns. This paper investigates the impact of taxation on economic growth in South Africa. The basic objective of this article is to evaluate the impact of both direct and indirect taxes on economic growth of India. Tax reforms are sometimes touted to have strong macroeconomic growth effects. Petroleum Profit Tax (PPT), government policy and economic growth (GDP). The Impact Of Tax Revenue On Economic Growth: Evidence From Nigeria DOI: 10.9790/5933-07113238 www.iosrjournals.org 33 | Page Objectives of the Study The general objective of the study was to examine the effect of taxation on the growth of the Nigerian economy. The horizontal axis measures the year paper published or the last draft appeared. The positive and negative effects of taxation will be mutually offsetting and only the net effect (which may be very small) will be observed. The direct and immediate effect of direct taxation is reduction in income of the person on whom it is levied. Mertens and Olea (2018) used time series data from 1946 to 2012 to estimate the impacts of marginal tax rates on individual income. Taxation as a Determinant of Economic Growth in South-Eastern Europe: The Case of Bulgaria and Croatia Ioanna Glykou 1, Vasileios Siokorelis 2 Abstract: Taxation through its impact on entrepreneurial activity, the attraction of Foreign Direct Investments, as well as disposable income and savings can be a crucial factor for economic growth. Furceri and Karras (2009) researched to investigate the effects of changes of taxes on economic growth by using an annual data from 1965 to 2007 for panel of twenty-six economies. They need to be set up to minimise taxpayers‟ compliance costs and government‟s administrative cost, So this paper trying to investigate the short and long run effects of taxation on . To examine the impact of company income tax on the real gross domestic product of Nigeria. Yearly data for South Africa for the period 1981 - 2016 was used to develop the Auto-Regressive Distribution Lag (ARDL) approach. This topic is discussed from different aspects. Figure 1 The reported tax-growth effect do not converge Notes: The figure depicts the median estimated coefficients corresponding to the effects of taxes on economic growth reported in individual studies. Empirical Review Ofoegbu, Akwu & Oliver (2016) found a positive and significant relationship between revenue generated by Nigeria government through tax and her economic development. The This study analyzed the impact of taxation as a whole as well as the impact of indirect and direct taxes on economic growth using a simple endogenous growth model. The Impact of Taxation on Economic Growth Using ARDL Approach: A Case Study of Pakistan Sareer Ahmad * Majid Ali † Saleem Khan ‡ Abstract: This study intends to observe to investigate the taxation impact on economic growth of Pak- istan by using time series data from 1980 to 2015. (1986-2011) ABSTRACT The research work will discuss in detail the impact of taxation on Economic growth in Nigeria. In addition to financing government operations . The Impact of Swiss Taxation on Economic Growth * by Georg Junge, Basel Introduction This paper is an attempt to quantify the importance of the interference of the Swiss tax system with Swiss economic growth and factor productivity. We consider the impact of a major tax reform on the long-term growth rates of the U.S. economy using three approaches. Testing the impact of taxation on economic growth in Romania Estimating the influence of public revenues on economic growth is made by determining the regression coefficients, where changes in dependent variable, real GDP growth rate, are expressed by distortionary, non-distortionary and other incomes. The analysis focuses on the impact of tax structures to long- run growth. 3. This paper studies the impact of taxation on economic growth of the eight WAEMU countries. Abstract- The contribution of taxation to any economy globally is so much in terms of quantification and cannot be therefore be ignored as unimportant. Ethiopia is one of the fastest developing countries situated in the North-Eastern corner of Africa. Taxation and Economic Growth GARETH D. MYLES* Abstract The development of endogenous growth theory has opened an avenue through which the effects of taxation on economic growth can be explored. Annual data for the time period 1980 - 2018 used to develop an Auto-Regressive Distribution Lag (ARDL) approach. Finally, a tax is not imposed on a citizen by the government because it has rendered specific services to him or his family. that the "economic effects of taxation include micro effects on the distribution of income and efficiency of resource use as well as macro effects on the level of capacity output, employment, prices and growth". This allows us to analyse the potential benefit to economic growth Growth Okafor (2012) investigated the impact of income tax revenue on Adegbie and Fakile (2011) examined the relationship between the economic growth of Nigeria as proxied by the gross domestic company income tax and Nigeria's economic development for the product (GDP). institutions and structure of tax revenue can affect the economic growth in many different levels. They found that marginal rate cuts led to both increases in real GDP and declines in unemployment. the impact of VAT on the economic growth. Finally, we will use the Bush tax cuts of 2001 as a case study of lowered tax rates, and draw conclusions about the overall effectiveness of these tax cuts. TAX AND ECONOMIC GROWTH 1. The study adopted the ordinary least square period 1981 - 2007. 1. This paper investigates the design of tax structures to promote economic growth. Tax revenue and economic growth in Jordan have been undertaking an upward growth path in absolute terms. Empirical Review Ofoegbu, Akwu & Oliver (2016) found a positive and significant relationship between revenue generated by Nigeria government through tax and her economic development. tax systems in Latin America and its consequence in relation to the real economy.2 This paper describes, identifies, and analyzes the potential impact of tax policies on economic growth for selected Latin American countries and draw conclusions for several specific countries and for the region as a whole. Cullen and Gordon (2002) explore the many potential effects of the tax system on en-trepreneurial activity, and find strong empirical support for these tax effects using U.S. individual income tax return data during 1964-93. The effects of various tax policies on economic growth are reex-amined on the basis of the recently developed endogenous growth theory. The majority of authors analyses how tax on income influences economic growth and how taxes on corporate income affect economic growth. In fact, the sub-institutions interrelate to personal income tax has a significantly negative impact on economic growth. The study used time series data for the period (1975-2014) to analyze the impact. This perspective emphasiz- THE IMPACT OF TAXATION REVENUE ON ECONOMIC GROWTH IN NIGERIA FROM 2005-2014 . Consumption is the biggest component of the GDP and therefore a reduction in consumption is likely to slow down economic growth. It suggests a "tax and growth" ranking of taxes, confirming results from earlier literature but providing a more detailed disaggregation of taxes. There are same bad effects of taxes too. On the other hand, the interaction of sub-institutions and FDI corporation tax revenue can create a contrary impact. countries, tax reforms are highly political endeavours. Various studies on the impact of government revenue on economic growth hardly consider VAT as a separate variable; hence, the study intends to test the following hypotheses: Hoa: Value Added Tax has no significant positive relationship with economic growth in Nigeria. This dissertation, titled "Effects of Taxation on Economic Growth (Uganda's Experience: 1987-2005)", reviews the theoretical and empirical evidence to assess how taxation affects the rate of economic growth in Uganda. of the period is to determine the impact of CIT, PPT and VAT on economic growth of Nigeria since democratically elected government took over in 1999. that indirect taxation has a positive and significant impact on growth economic linked to direct taxation which has a positive but insignificant impact on Nigeria's economic growth. This is why we present the book compilations in this website. 2 of growth in the long run. It will also take cognizance of the aims and objectives of taxation and its impact on the economic growth of Nigeria. At this stage, however, there is little agreement about 617 This paper investigated empirical evidence on contributions of tax revenue for economic growth of . Taxes thus affect an economy in various ways, although the effects of taxes may not necessarily be good. Downloadable! These are labor supply, capital investment, technological progress, and human capital. In as much as taxes improve the government''s revenue, it also reduces the disposable income available to households for consumption. It specifically explored the linkages among company income tax, petroleum profit tax and the economic growth of Nigeria proxied with Real Gross Domestic Product, using time series data for the period 1981 to 2016.Ex Post-Facto research design was employed. Uniamakogbe (2006). The line shows the linear fit. The empirical results confirm that there is a negative relationship between taxes and economic growth in South Africa. There is a general lack of consensus among scholars on the contribution of tax revenue to the economic growth of nations. P roblems of taxation, in connection with economic development, are generally discussed from two different points of view, which involve very different, and often conflicting, considerations: the point of view of incentives and the point of view of resources.Those who believe that it is the lack of adequate incentives which is mainly responsible for insufficient growth and investment are . ABSTRACT. Using three approaches, we consider the impact of a major tax reform—a 5 percentage point cut in marginal tax rates—on long-term growth rates. Empirical Studies Observe Nonlinear Impact of Taxation on Economic Growth Also, the studies that find a non-linearity relationship between taxation and economic growth such as Aydin and Esen utilize different samples, different periods, various methods, and so on [21]. In particular, reducing tax expenditures, which mostly benefit the well-off, contributes to equity objectives while also allowing for a growth-friendly cut in marginal tax rates. IMPACTS OF TAXATION ON ECONOMIC GROWTH IN KENYA (1980-2019) CHAPTER ONE INTRODUCTION 1.0 BACKGROUND OF THE STUDY In developing countries, taxation is a strategic tool that makes it possible to finance the provision of public goods and services such as education, health, infrastructure, and justice which are all essential for economic growth. The Impact of Taxation on Economic Growth Using ARDL Approach: A Case Study of Pakistan Sareer Ahmad * Majid Ali † Saleem Khan ‡ Abstract: This study intends to observe to investigate the taxation impact on economic growth of Pak- istan by using time series data from 1980 to 2015. The second section, following the methodology outlined by Hall and Jorgenson (1967), will include an estimate of the impact that reduced corporate income tax could have on private investment. This does not imply that it is straightforward to infer the effects of taxation from aggregate economic data. effects on economic growth.2 If tax cuts fail to produce the projected boost in economic growth, tax revenues could decline, putting upward pressure on the deficit, worsening levels of national saving, and leading to laggard economic growth in the future. Margaret, Charles and Gift (2014) examine the impact of taxation on economic growth in Nigeria, covering the period 1994-2012 This study also uses other variables such as tax rate and income tax. The Impact Of Tax Revenue On Economic Growth: Evidence From Nigeria DOI: 10.9790/5933-07113238 34 | Page payer may not be equivalent to the benefits received. The main objective of the study was to establish the effects of taxation on economic growth. The Impact of Taxation on Economic Growth: Case Study of OECD Countries R. Macek Published 29 January 2015 Economics Review of Economic Perspectives Abstract The aim of this paper is to evaluate the impact of individual types of taxes on the economic growth by utilizing regression analysis on the OECD countries for the period of 2000-2011. The first approach is to examine the historical record of the U.S. economy to evaluate whether tax cuts have been associated with economic growth. CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY In a natural resources blessed country like Nigeria also with the operation of indigenous and foreign companies, the problem of underdevelopment should not be the topic of the day. The study found a significant and reducing government borrowing, the Value added tax was positive relationship between indirect tax and economic introduced in January 1993 by the VAT decree No. of the period is to determine the impact of CIT, PPT and VAT on economic growth of Nigeria since democratically elected government took over in 1999. Effects of Taxes on Economic Behavior Martin Feldstein* I am pleased to be part of this National Tax Journal forum celebrating the 100th anniversary of the National Tax Association and grateful for the invitation to discuss the effects of taxes on economic behavior, a subject that has been central in my research since my 1967 . Taxes can af fect economic growth in two ways : first by influencing aggregate supply of the main Results of the bounds test specify that the variables of economic growth, taxes, capital and trade are cointegrated. Other articles examine how to design an effective tax policy for economic recovery and growth. The first approach is to examine the historical record of the U.S. economy to evaluate whether tax cuts have been associated with economic growth. As such, investigating effects of taxes on GDP provide a suitable way to monitor economic growth (Johansson et al, 2008). Some of these studies use numerical models to calculate the ef-fect of tax reform on growth (e.g., Lucas (1990), Jones, Manuelli and studied economic growth and tax charges in OECD countries from 1980 to 1999; their study reveals that economic growth measured by GDP per capital has significant effect on tax mix of GDP per capita. Let us look at the impact of taxes on the economy of a country in details now. 1993 and came into force on the 1st of January 1994 to. We consider the impact of a major tax reform on the long-term growth rates of the U.S. economy using three approaches. To evaluate the effect of petroleum profit tax on the real gross domestic product of Nigeria. affected by the tax system) and growth, the effects of corporate income tax reform on growth and the detailed literatures on the effects of taxes on labor supply, saving, and investment. Taxation and Economic Growth. to estimate the impact of carbon taxes in European countries on GDP and found no adverse impacts of the tax on economic growth or employment. Paying Taxes survey. The impact of taxation is integrated into growth models by its impact on the individual growth variables, which are capital accumulation and investment, human capital and technology. Economic growth remains a macroeconomic objective of any nation, developed and developing alike. maintain that the economic effects of taxation include micro effects on the distribution of income and efficiency of resource use as well as macro effects on the level of capacity output, employment, prices and growth. Among the critiques addressed to the public sector, numerous are those that refer principally to the negative effects which entail high weight and increasing of taxation. The aim of the Kenyan government is to stimulate and guide her economic and social development goals through its public revenue (Duncab 2019). In order to evaluate the impact of public infrastructure and taxation on economic growth, this study makes use of the panel data methodology for a sample of 96 countries for the period 1976 to 2011 (annual frequency - see table A1). ABSTRACT This research work focuses on the impact of Taxation on the economic and social development in Nigeria. The assertion of Henry George that the structure of taxation is more important than the level of taxation in explaining economic growth is elaborated and verified. It also aimed at identifying problems that inhibit the doc, pdf Nwezeaku (2005), reports that the government has certain functions to perform for the benefit of its citizens. . and long run effects of taxation on economic growth in an emerging country, Jordan. Thus, it is evident that a good tax structure plays a multiple role in the process of economic development of . It is a state of several kinds of taxation. Committee on Taxation, includes an overview of economic growth and the impact that taxes may have on economic growth. Government exists in order to effectively collect taxes from available economic resources and make use of same to create economic . Summary and conclusion 1. 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