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2019 | vol. 19, iss. 2 | 7--24
Tytuł artykułu

Assessing the Effects of Corporate Taxation on the Investment Policy of Manufacturing Firms in Nigeria

Warianty tytułu
Języki publikacji
EN
Abstrakty
EN
Research Background: The complexities of taxes in business have a tendency of endangering investment decisions at every point in time, if such complexities are not strategically managed. Purpose: This study therefore assesses the effect of corporate taxation on the investment policy of quoted manufacturing firms in Nigeria. Research Methodology: Secondary data sourced from annual reports of the selected firms were analysed using descriptive and inferential statistics. Specifically, static panel least square regression techniques were used. Result: The results of the study revealed that company income tax (CIT) is positively related to the investment decision of the quoted manufacturing firm (INV), and thus enhances the investment of the quoted manufacturing firm (INV) in Nigeria. The probability value revealed that company income tax (CIT) had a statistical significant correlation with the investment of the quoted manufacturing firm in Nigeria. This implies that higher corporate income taxes are associated with lower investment in manufacturing firms. Novelty: This study digressed from examining the effects of corporate tax on financial performance as that was the major focused area in this context. However, this study assessed its effect on investment decisions. Hence, this study was able to recommend that the Nigerian government should encourage and enhance manufacturing investment decision by designing an appropriate corporate income tax policy. An investment decision that is fostered on new capital, encourages the implementation of new production techniques and thus should be engineered for the development of manufacturing firms. (original abstract)
Rocznik
Strony
7--24
Opis fizyczny
Twórcy
  • Ekiti State University, Ado-Ekiti, Nigeria
  • Durban University of Technology, South Africa
  • Ekiti State University, Ado-Ekiti, Nigeria
Bibliografia
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  • Ahiabor G. Amoah A. (2013). The Effects of Corporate Taxes on the level of Investment in Ghana. Development Country Studies3 (1) 57-67.
  • Akinwunmi A.J. Olotu A.E. Adegbie F.F. (2017). Multiplicity of Taxes and Foreign Direct Investment: A Relational Analysis of Nigerian Tax Environment. Social Sciences6 (4) 11-31.
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  • Dagogo D.W. Daibi W. (2015). Re-Investment Allowance Investment Tax Credit and the Reality of Corporate Cash Flow in Nigeria. IOSR Journal of Economics & Finance6 (2) 51-55.
  • Edame G.E. Okoi W.W. (2014). The impact of taxation on investment and economic development in Nigeria. Academic Journal of Interdisciplinary Studies3 (4) 209.
  • Edgerton J. (2011). The effects of taxation on business investment: New evidence from used equipment. Federal Reserve Board of Governors Mimeo January.
  • Ibanichuka E.L. Akani F.N. Ikebujo O.S. (2016). A time series analysis of effect of tax revenue on economic development of Nigeria. International Journal of Innovative Finance and Economics Research4 (3) 16-23.
  • Kurawa J.M. Saidu H. (2018). Corporate Tax and Financial Performance of Listed Nigerian Consumer Goods. Journal of Accounting and Financial Management4 (4) 30-43.
  • Mayende S. (2013). The effects of tax incentives on firm performance: Evidence from Uganda. Journal of Politics & Law6 (4) 95-115.
  • Olaleye M.O. Riro G.K. Memba F.S. (2016). Effect of reduced company income tax incentives on foreign direct investment in listed Nigerian manufacturing companies. European Journal of Business Economics & Accountancy4 (1) 39-54.
  • Oliech E.A. (2013). The Effect of Corporate Taxes on Investment Decisions of Companies Listed At The Nairobi Securities Exchange. Published thesis. Retrieved from: http://erepository.uonbi.ac.ke/bitstream/handle/11295/59126/Asingwa _The Effect Of Corporate Taxes On Investment Decisions Of Companies Listed At The Nairobi Securities Exchange.pdf?sequence=5&isAllowed=y.
  • Oloidi G.A. (2014). Company Income Tax and Investment Decisions: A Behavioural Approach. IOSR Journal of Business and Management16 11-19.
  • Omodero C.O. Ogbonnaya A.K. (2018). Corporate tax and profitability of deposit money banks in Nigeria. Journal of Accounting Business and Finance Research3 (2) 47-55.
  • Onuorah A. Chigbu E.E. (2013). A Comparative Analysis of the Impact of Corporate Taxation OnCompany's Reserve and Dividend Policy in Nigeria: 2000-2011. Developing Country study International Knowledge Sharing Platform3 (1) 1-20.
  • Onwuka O.O. (2019). Impact of Corporate Taxation on Dividend Payments: Evidence from Nigerian Deposit Money Banks. Journal of Accounting and Financial Management5 (1) 1-17.
  • Pogge T. Mehta K. (eds.) (2016). Global tax fairness. Oxford University Press.
  • Raza S.A. Ali S.A. Abassi Z. (2011). Effect of corporate income tax and firms' size on investment: evidence by Karachi stock exchange. European Journal of Economics Finance & Administrative sciences. Retrieved from: https://mpra.ub.uni-muenchen.de/id/eprint/36800.
  • Simmons R.S. (2000). Corporate taxation and the investment location decisions of multinational corporations (HKIBS working paper series 035-990). Retrieved from Lingnan University website. Retrieved from: https://commons.ln.edu.hk/hkibswp/7.
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Typ dokumentu
Bibliografia
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Identyfikator YADDA
bwmeta1.element.ekon-element-000171578188

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