TAX REVENUE AND ECONOMIC GROWTH: A COMPARATIVE STUDY OF NIGERIA AND SOUTH AFRICA

This study ascertained the effects of tax revenue on economic growth of Nigeria and South Africa. The specific objective of the study is to; ascertain the effect of the Company Income Tax and Value-Added Tax on Real Gross Domestic Product of Nigeria and South Africa. The dependent variable, economic growth was proxied with real gross domestic products RGDPs of both countries. Data were sourced from World Bank Data, Federal Inland Revenue (FIRS) from Nigeria and South African Revenue Services from 2001-2024. The statistical tool applied was pre-analyses tests such as: Descriptive Statistics, Pearson Correlation and Error Correction Model Regression Analysis. Based on the study revealed that CIT has a positive but non-significant statistical effect on the real gross domestic products in Nigeria, but recorded a negative and non- significant statistical effect on the real gross domestic product of South Africa. The study also discovered that VAT has positive effect on real gross domestic product in Nigeria and South Africa though the effect was statistically not significant in Nigeria, but statistically significant in South Africa. A review of corporate income tax is necessary to close loopholes that facilitate tax avoidance, which many companies exploit to evade taxes, thereby boosting economic growth in Nigeria more than in South Africa, where the variables indicate a long-term rise in RGDPs.