TAX INCENTIVES AND CORPORATE INVESTMENT: EVIDENCE FROM MANUFACTURING FIRMS IN
RIVERS STATE, NIGERIA
AGWOR, ThankGod, C.
Department of Accountancy, Faculty of Management Sciences,
Rivers State University, Port Harcourt
and
FYNEFACE, Tamuno-opubo Lugard
Department of Accountancy, Faculty of Management Sciences,
Rivers State University, Port Harcourt
ABSTRACT
This study investigates the influence of tax incentives on corporate investments of manufacturing firms in Rivers State. Tax incentives were operationalized as tax holiday, capital allowance and loss relief, while the measures of corporate investment were research and development investment and equipment investment. Copies of questionnaire were distributed to staff of the manufacturing firms under study in Rivers State. The Pearson’s Product Moment Correlation and Regression Analysis were used in analyzing the data using Statistical Package for Social Sciences version 20.0. The result established that tax incentives bears an influence on corporate investments, of manufacturing firms Rivers State. The study concludes that tax incentive significantly influences corporate investments of manufacturing firms in Rivers State. The study recommends the review of current tax incentive scheme to adequately deal with investment in the manufacturing sector. Existing tax incentive laws should be reviewed to cater for current economic, technological, environmental, social situations in Rivers State. Bearing in mind the significance of tax incentives for research and development and equipment purchases, efforts should be made by government and media to educate and inform firms in Rivers State of the benefits of taking advantages of existing tax incentives.
Keywords: Tax, Tax incentives, corporate investment, manufacturing firms, corporate investment