Assessing Comparative Contributions of Internally Generated Revenue and Value Added Tax to the Recurrent Expenditure of Kogi State (2002-2014)
Ocheni, S.I; Ezugwu, C.I; Akubo Daniel
The tax revenue from both internal and external sources is a vital tool for running government programmes. The payments of workers’ salaries have become a serious challenge in Kogi state, due to low revenue generation from the state internal revenue sources and over dependence on the external sources of revenue which has not been stable due to dwindling crude oil price at the international market. This study compares the contributions of internally generated revenue and value added tax pool account to the recurrent expenditure of Kogi State. This study employed ex-post facto research design for the period of thirteen years (2002-2014).The time series data for actual internally generated revenue, actual allocation from value added tax and recurrent expenditure of Kogi State were used. Descriptive statistics were used to analyse the data while Ordinary Least Square regression was used to estimate the model and test the null hypotheses formulated. The results show that internally generated revenue has no significant contribution to the recurrent expenditure of Kogi State but that value added tax has a significant positive contribution to the recurrent expenditure of Kogi State. The study recommends among others that the Kogi state government should come up with an aggressive tax enforcement policy to increase her internally generated revenue in the state through enforcement of Taxpayer Identification Number (TIN). This should be done by allowing the registration of the taxable persons to be done in all the area tax offices across the state as against the present central registration centre in Lokoja, in order to bring more people into the tax net.
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