Countries all over the world, look for ways to boost their revenue, this facilitated many nations to
introduce value added tax on goods and services. We examined the effect of value added tax on
the economic growth of Nigeria. The result shows that VAT contributes significantly to the total
tax revenue of government and by extension the economic growth of Nigeria. The growth pattern
of GDP from 1994 (the year of inception) to 2009 was oscillating. It increased geometrically
between 2010 and 2011. VAT revenue growth had consistent increase though the growth was not
as explosive as that of the GDP. To boost tax revenue we need to boost revenue collected from
VAT. This can be achieved not necessarily by increasing the VAT rate of 5% percent but by
closing every VAT revenue leakage, sensitizing the managers of companies operating in Nigeria