Tax Reform and Non-Oil Tax Revenue in Nigeria: Evidence from Democratic Regime Period 1999-2025

Nigeria's persistent dependence on petroleum revenue has heightened the importance of strengthening non-oil tax revenue as a sustainable source of public finance. Although successive governments have introduced tax reforms aimed at broadening the tax base, improving compliance and strengthening revenue administration, empirical evidence on the effects of specific tax reform instruments on non-oil tax revenue remains limited. This study examines the relationship between tax reform and non-oil tax revenue in Nigeria: evidence from 1999 to 2025 using three principal explanatory variables: tax reform events (TRE), personal income tax reform events (PITR), and education tax rate (ETR), while controlling for real non-oil gross domestic product (RNOGDP). Annual time-series data covering 1999–2025 were obtained from relevant Nigerian fiscal and macroeconomic sources. To prevent structural changes in the RNOGDP series from contaminating the estimated tax relationships, structural-break controls for 2011 and 2016 were incorporated into the final specification. The study employed unit-root testing and an autoregressive distributed lag (ARDL) error-correction framework to distinguish between shortrun and long-run relationships. The results indicate that TRE has a positive and statistically significant long-run effect on non-oil tax revenue (β = 0.1849, p = .028), while PITR has a negative and significant effect (β = −0.7574, p = .032). ETR has a large positive and statistically significant long-run coefficient (β = 136.1290, p < .001), while RNOGDP is also positive and significant (β = 1.2702, p < .001). The structural-break controls for 2011 and 2016 are statistically significant, confirming the importance of accounting for changes in the RNOGDP series. The error-correction coefficient of −0.9146 (p < .001) indicates rapid adjustment toward long-run equilibrium. The study concludes that the effectiveness of tax reform in increasing non-oil tax revenue depends not only on the introduction of reforms but also on the specific instrument and the broader economic environment. It recommends strengthening reform implementation, improving personal income tax administration, and maintaining education-tax policies that support sustainable revenue mobilisation.