TAXATION POLICIES AND HUMAN DEVELOPMENT IN NIGERIA: REFORM STRATEGIES TO ENHANCE THE HUMAN DEVELOPMENT INDEX
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Abstract
This study examines the relationship between taxation policies and human development in Nigeria, with specific focus on how fiscal policy instruments—particularly taxation—affect the Human Development Index (HDI) components of life expectancy, education, and standard of living. Using secondary data from 2016 to 2024 sourced from the National Bureau of Statistics, Central Bank of Nigeria, World Bank, and Debt Management Office, the study employs descriptive and quantitative analytical techniques to assess the impact of taxation on human development outcomes. The findings reveal that Nigeria's tax system has performed suboptimally, with tax-to-GDP ratios consistently below African averages, and that taxation policies have had negative effects on Human Development Index during the study period. The study recommends comprehensive tax reforms including broadening the tax base, strengthening tax administration, ensuring equitable tax allocation to human development sectors, and implementing growth-friendly taxation policies that do not overburden the poor. The study is anchored on Keynesian theory of fiscal policy, which posits that strategic government intervention through fiscal instruments can stimulate economic growth and enhance citizen welfare when properly implemented.
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