An Empirical Analysis of Tax Leakages and Economic Growth in Nigeria

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Adedeji, T.O
Oboh, C.S
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The government has for the umpteenth time complained of the widespread incidence of tax avoidance and evasion in the country as companies and other taxable persons employ various tax avoidance devices to escape or minimize their taxes or deliberately employ fraudulent ways and means of evading tax altogether, sometimes with the active connivance of the tax officials. This paper empirically examined the economic implication of tax leakages on the Nigerian economy. A survey research design was adopted and responses were obtained through the use of a well structured questionnaire administered to 185 respondents. Findings from the empirical analysis using Kendall’s w-test and Chisquare test statistics reveal that tax evasion and avoidance have adversely affected economic growth and development in Nigeria, and also, that lack of good governance is the basis for which tax leakages activities is perpetrated. The study therefore recommends that the government should embrace and promote good governance so as to encourage voluntary compliance of tax liability by the citizenry.
Staff Publications
Tax avoidance , Economic growth , Good governance , Tax liability
Adedeji, T.O and Oboh, C.S (2012) An Empirical Analysis of Tax Leakages and Economic Growth in Nigeria. European Journal of Economics, Finance and Administrative Sciences, 48