Petroleum Profit Tax and Economic Development in Nigeria

This study examines the contribution of Petroleum Profit Tax (PPT) to economic development in Nigeria, with a focus on how revenue derived from upstream oil operations translates into measurable welfare outcomes. Nigeria's heavy dependence on petroleum revenue has been extensively documented, yet the developmental efficiency of PPT allocations remains a subject of policy debate. This research employs an ex-post facto documentary design, analysing data from the Federal Inland Revenue Service, the Nigerian National Petroleum Company Limited, and the National Bureau of Statistics over the past decade. Key variables include PPT revenue, federal capital expenditure, human development indicators, and gross domestic product growth rates. Trend analysis, correlation, and simple regression are the primary analytical tools. The study expects to find that while PPT contributes significantly to federal revenue, its translation into sustainable development outcomes is weakened by fiscal leakages, poor expenditure management, and inadequate savings mechanisms. The volatility of crude oil prices further undermines long-term revenue planning. Recommendations include strengthening the Sovereign Wealth Fund as a stabilisation tool, improving the efficiency of capital budget execution, and diversifying Nigeria's tax base to reduce PPT dependency. The study advocates for greater transparency in oil revenue reporting and stronger legislative oversight of NNPCL remittances. This research offers undergraduate students a grounded introduction to the fiscal dimensions of Nigeria's oil economy. Keywords: petroleum profit tax, economic development, revenue utilisation, oil dependence, fiscal policy.