PETROLEUM PROFIT TAX AND ECONOMIC GROWTH OF NIGERIA (A STUDY OF FEDERAL INLAND REVENUE SERVICE)

This study assessed Petroleum profit tax (PPT) and economic growth of Nigeria. With Federal Inland Revenue Service as case study. The main objective of this study was to assess the Contribution of petroleum profit tax to the economic growth of Nigeria from 2014 to 2023. The specific objectives were as follows; to determine the contribution of Petroleum profit tax to the total revenue of Nigeria from 2014-2023, to assess the contribution of PPT to the GDP of Nigeria from 2014-2023 and to assess contribution of PPT to PCI in Nigeria from 2014-2023. The study adopted the ex-post facto research design. 27staff of FIRS, Uyo served as population of the study. A non-probability purpose sampling technique to select 25 respondents as sample size of the study. The study used both primary and secondary source of data collection. Data collected for the study was analyzed using simple percentage and hypothesis was tested using Simple linear regression. Finding reveals that; the contribution of the oil sector to the country's Revenue amounted to about 5.48 percent, contributions of petroleum industry to the growth of Nigeria gross domestic Product GDP amounted to about 5.5 percent in 2023 and PPT contribute to the PCI in Nigeria from 2014-2023 through; Government Revenue for Public Expenditure, Stabilizing the Economy and lastly Job Creation in the Oil Sector. The study further Concluded that Nigeria has the potential to build a prosperous economy, reduce poverty significantly, and provide the health, employment generation, education, and infrastructure services to its population needs. Considering the positive and significant impact of petroleum profit tax and economic growth in Nigeria, there is an urgent need for government to prioritize her needs as petroleum revenue continues to decrease and a situation where most of registered firms were not in the tax system. With these, the study recommended that; Government should expand the tax yield through improved tax system administration. This is because of the danger of over-reliance on crude oil export receipts to drive the economy. Government should try to diversify the economy, in so doing, revenue accrue to government through petroleum profit tax should be judiciously used to develop other sectors.