The Relevance of Tax Revenue on Budget Implementation in Nigeria (2012-2021)

Abstract This study examined the relevance of tax revenue on budget implementation in Nigeria, encompassing value-added tax, company income tax, and customs and excise duty, while measuring budget implementation through total accrual expenditure. The study utilized a time series dataset spanning from 2012 to 2021, sourced from the CBN statistical bulletin, 2022. Both descriptive and inferential analytical tools were employed, with variables described using mean, standard deviation, maximum, and minimum values. This was followed by Pearson correlation coefficient, unit root, co-integration, and error correction model estimation. The analysis revealed that value-added tax had a positive yet non-significant impact on budget implementation, with values of 0.3284 and 0.1781. Additionally, company income tax and customs and excise duty were found to have a progressively significant impact on budget implementation in Nigeria, with coefficient and probability values of 0.1486 (0.0183) and 0.2687 (0.0294) respectively. Consequently, it was concluded that tax revenue statistically influences budget implementation in Nigeria. To address this, it is recommended that the Nigerian government establishes a governing council to monitor revenue and expenditure, thereby minimizing discrepancies between planned and actual figures.