Effect of Tax Incentives on the Growth and Development of Manufacturing Firms in Nigeria

Abstract:

The study examined the effect of tax incentives on the growth and development of Manufacturing firms in Nigeria. The study employed ex-post facto research design. Data on corporate income tax incentives, capital allowance incentives, custom duty incentives, excise tax incentives and return on asset were secondarily sourced from financial statement of account from 2013 to 2018. The data were analysed using ordinary least square of multiple regression technique through E-view 9.0. Based on the analysis of the study, the results revealed that corporate income tax incentives (P = 0.00 < 0.05) has positive and significant effect on return on asset; capital allowance incentives (P = 0.00 < 0.05) has positive and significant effect on return on asset; custom duty incentives (P =0.00 < 0.05) has positive and significant effect on return on asset, excise tax incentives (P =0.00 < 0.05) has positive and significant effect on return on asset in Nigeria. The study concluded from findings of the study that tax incentives on the growth and development of Manufacturing firms in Nigeria. The study recommended the need for the government to conduct cost benefit analyses in order to ensure that the goals of granting such incentives are achieved.