European Journal of Accounting, Finance and Investment

The Nexus Between Direct Taxes And Total Tax Revenue Of The Federal Government Of Nigeria

Edori D. S

Business Department, C. S. S. Mgbuoshimini, Port Harcourt, Rivers State, Nigeria

Atabusi, Michael

Federal Inland Revenue Service, Port Harcourt, Rivers State, Nigeria

Keywords: Tax education, Petroleum Profit Tax, Total Tax Revenue

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Abstract

Tax revenue is adjudged to be the most consistent source of revenue to the federal government. This assertion resulted to the study on the nexus between direct taxes and total federal tax revenue of Nigeria. The study was anchored on the ex post facto form of research design. Time series data (secondary data) from 2005 to 2020 was collected from the Federal Inland Revenue service and was analysed using simple regression analysis. The study indicated that significant relationship exists between education tax and total tax revenue and petroleum profit tax and total tax revenue with a probability value of 0.000 and 0.002 respectively. Also, both education tax and petroleum profit tax have positive relationship with total tax revenue with R2 values of 0.729 and 0.524 respectively. Recommendations made by the study are, that tax reforms, policies and restructuring of education tax by relevant tax authorities should be undertaking to ensure its steady growth and also strict measures should be taking in order to boast the economy and also ensure total compliance. It was then concluded that the relationship between direct taxes and total federal tax revenue is positive and significant.