The 2011 Personal Income Tax Reform and Non-Oil Revenue Generation in Nigeria: An Empirical Evaluation

The purported outstanding nature of the 2011 Personal Income Tax (PIT) reform of the Nigerian government calls for empirical evaluation of its implications on the Non-oil revenue generation of the federal government of Nigeria particular now that the economy is in recession and the continued dwindling nature of oil revenue which has made concerted efforts towards increasing the non-oil revenue inevitable. Against this backdrop, this study seeks to evaluate the impact of 2011 personal income tax reform on federal government’s non-oil revenue generation in Nigeria. Ordinary Least Square (OLS) regression analysis was utilized in analyzing the data collected on PIT revenue for the period covering 2006-2015 while Chow-test was employed in testing the hypotheses of the study. Findings revealed that the PIT revenue has no significant impact on the federally collected non-oil revenue in Nigeria since after the 2011 PIT reform. The implication thus is that the 2011 PIT reform policy of the government has not significantly impacted on the federal government revenue from non-oil sources (taxation). It is therefore the study’s recommendation that the government should review legal and administrative framework for the implementation of the policy to ensure that the highlighted objectives are achieved.