South Asian Journal of Finance

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Author: search.filters.author.Adegbite, T. A.Subject: search.filters.subject.Income Tax

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    Tax Implication on Recurrent Expenditure and Internally Generated Revenue: Analysis on Southwestern States, Nigeria
    (Department of Finance, University of Kelaniya., 2022) Adegbite, T. A.; Ishola, S.
    Purpose: This study examined internally generated revenue impact on recurrent expenditure performance in Southwest Nigeria. Internally generated revenue was captured with the aggregation of personal income tax, road tax and direct assessment tax while recurrent expenditure performance was proxied with expenditures expended on recurrent expenditure. Design/Methodology/Approach: Data realized from published annual bulletins of all the States’ Board of Internal Revenue and Statistical Year-Book in Southwestern Nigeria were analyzed using Panel data analysis. Findings: Panel data outcomes showed that personal income tax has a positive but insignificant effect on recurrent expenditure, but the direct assessment has a positive and significant effect on recurrent expenditure. Also, road tax was found to exert a positive but insignificant effect on recurrent expenditure in Southwest, Nigeria. Conclusively, it was established that there was a statistically significant effect of internally generated revenue on recurrent expenditure in Southwestern states, Nigeria. Originality: Having reviewed extant literature, it has been discovered that the existing literature was either restricted to one state or local government in a single state. Also, the methodology employed by the extant literature collecting and analyzing the data were primary data and regressions respectively. Therefore, this study extended its projection to all six southwestern states in Nigeria for effective determination of the impact of IGR on recurrent expenditure. Also, this study involved all components of panel data analysis to deep out the effect of IGR on recurrent expenditure which jointly ignited research gaps in the study as against the extant literature.