EFFECT OF COMPANY INCOME TAX ON REVENUE PERFORMANCE AND ECONOMIC GROWTH IN NIGERIA

Nigeria urgently needs to diversify its revenue sources, as reliance on crude oil is insufficient for sustaining public expenditure. Expanding the tax base to include non-oil sectors is essential for boosting revenue. However, tax revenue performance remains suboptimal, largely due to collection inefficiencies, limiting the government's ability to meet fiscal obligations and promote development. This study addressed these challenges by examining the impact of company income tax on revenue performance and economic growth in Nigeria. Specifically, it assessed the contribution of company income tax to total government revenue and analyze its effects on federal revenue performance and economic growth trends. An ex-post facto research design was utilized in this study, with secondary data sourced from published annual reports and statistical bulletins of the Central Bank of Nigeria, spanning the period from 2003 to 2022. The analysis employed both descriptive and inferential statistical tools. Descriptive statistics, including mean and standard deviation, were applied, while inferential statistics employed time series analysis techniques to examine the secondary data. The findings revealed an upward trend in the proportion of company income tax contributions to the total revenue generated annually by the Federal Government of Nigeria, highlighting its increasing significance within Nigeria's revenue structure. This finding is corroborated by empirical analysis, which reveal that Company Income Tax and other control variables (VAT and PPT) jointly exhibit a significant effect on Revenue profile of the Federal Government of Nigeria (p < 0.001). Conversely, the study found that Company Income Tax (p = 0.02) does not exhibit a significant trend regarding economic growth in Nigeria. The study concluded that company income tax, along with other taxes such as Value Added Tax (VAT) and Petroleum Profit Tax (PPT), significantly affects the government revenue profile but does not show a notable trend concerning economic growth in Nigeria. Recommendations include enhancing tax administration and compliance through training for tax officials and adopting advanced technologies to improve Company Income Tax (CIT) collection efficiency and reduce reliance on oil revenues. Implementing gradual tax reforms with compliance incentives will foster a cooperative corporate environment. Lastly, integrating tax policy with broader economic development strategies is vital for promoting revenue diversification and sustainable economic growth in Nigeria.