Tax Incentive Practices and Financial Performance of Consumer Goods Companies in Nigeria
No Thumbnail Available
Date
Journal Title
Journal ISSN
Volume Title
Publisher
"GLOBAL RESEARCH NETWORK" LLC (USA)
Abstract
Description
Tax cuts are being implemented in Nigeria to encourage domestic manufacturing investments and the expansion of local manufacturing sectors, which will reduce imports. Thus, this study took a critical look at Nigerian consumer products companies' financial performance and their use of tax incentives. One of the objectives of this study was to determine the relationships between capital allowance, investment tax allowance, and return on assets for consumer goods companies in Nigeria. Another goal was to determine the relationship between tax holidays and return on assets for consumer goods companies in Nigeria. In this study, the ex post facto research design was employed. The study's population and sample size as of 2022 on the floor of the Nigerian Stock Exchange were twelve (12) consumer products enterprises (NSE). The proposed study questions were evaluated using descriptive statistics. Multiple regression analysis was conducted with E-View to evaluate the hypotheses (10). The main resource for the study is secondary data. The study's findings, among other things, demonstrated that capital allowance and return on assets have a strong relationship for Nigerian consumer products companies. The investment tax allowance and the return on assets of consumer products companies in Nigeria are not strongly associated. The return on assets of Nigerian businesses that produce consumer items and the tax holiday do not significantly correspond. Based on the findings, among others, it was suggested that food product companies maintain and look into additional capital allowance charges since they increase return on assets. Due to the complexity and fluidity of Nigeria's tax laws, food product manufacturing companies in Nigeria should employ tax professionals, incorporate investment allowance (tax incentive) planning into their strategic financial planning, and make effective use of all readily accessible all-inclusive tax planning strategies. Return on assets will be significantly impacted by this. In order to maximize return on assets, food businesses should also train their accountants on where to find, how to evaluate, and how to use tax holiday incentives.
Keywords
Tax Incentive Practices, Financial Performance, Tax Holiday, capital allowance, capital allowance.