Attracting Foreign Direct Investment (FDI) In Nigeria through Effective Tax Policy Incentives

Etim, Raphael S.; Jeremiah, Mfon Solomon; Jeremiah, Ofonime O.

doi:10.33094/8.2017.2019.42.36.44

Cited by 16 publications

(7 citation statements)

References 5 publications

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“…Finally, in an exploration over a 19 year period, Etim et al (2019) ascertained the outcome of cost-centered and profit-centered tax strategy incentives on FDI in Nigeria. For the study, secondary data were sourced from the CBN and World Bank database.…”

Section: Synergy Between Fiscal Incentives and Fdimentioning

confidence: 99%

Modelling the synergy between fiscal incentives and foreign direct investment in Ghana

Abille

Mpuure

Wuni

et al. 2020

JED

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PurposeThe purpose of the paper was to investigate the role of fiscal incentives in driving foreign direct investment (FDI) inflows into the Ghanaian economy based on data from 1975 to 2017 with the Eclectic paradigm as the theoretical basis. FDI inflows was the dependent variable whiles trade openness, corporate tax rate, exchange rate and market size were the independent variables with corporate tax rate as the main explanatory variable of interest.Design/methodology/approachThe autoregressive distributed lag (ARDL) bounds test technique was employed to investigate Cointegration in the model. The results showed the presence of cointegration among the variables.FindingsThe results revealed that corporate tax rates have a significant negative impact on FDI inflows into the Ghanaian economy in the long run and significant positive impact on FDI inflows in the short run. In the context of Ghana, the positive short-run relationship observed is attributed to the lag effect of tax policy on FDI inflows.Research limitations/implicationsOne obvious limitation of the research is that, it does not identify the specific foreign businesses that are more deserving of a low corporate rate and to what extent can that boost FDI inflows in Ghana. Another limitation is that the data analyzed in the paper is exclusively for Ghana and the findings may not be generalized for other countries.Practical implicationsBased on the research findings, it is recommended that the Ghana Revenue Service (GRA) restructures the corporate tax regime in the country to deal with the policy lapses. It is also recommended that low corporate rates should be maintained especially in respect of foreign companies that are into the production of goods and services for which indigenous companies in Ghana have a comparative disadvantage in order to drive FDI into the Ghanaian economy.Originality/valueThis paper is unique for providing up to date and dynamic insights into the tax incentive and FDI nexus in the Ghanaian context.

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Section: Synergy Between Fiscal Incentives and Fdimentioning

confidence: 99%

Modelling the synergy between fiscal incentives and foreign direct investment in Ghana

Abille

Mpuure

Wuni

et al. 2020

JED

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“…The applicable rules for corporate taxation in Nigeria do not effectively capture the realities of a modern economy in our world of fast-paced digital transactions (Oseni, 2015). Given that non-resident companies are taxed in Nigeria based on profits derived from Nigeria, the question as to whether a foreign company is liable to income tax in Nigeria is usually controversial (Etim, Jeremiah and Jeremiah, 2019). Section 13 of Companies Income Tax Act (CITA) implies that a non-resident company must have physically performed activities in Nigeria, directly or indirectly, before such a company can be liable to income tax in Nigeria (Otienoet al, 2013).…”

Section: Challenges Of Taxing Digital Economy In Nigeriamentioning

confidence: 99%

Tax Compliance and Digitalization of Nigerian Economy: The Empirical Review

Etim¹,

Jeremiah²,

Dan³

2020

AIJSS

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The paper examined the effect of digitalization of economy on tax compliance in Nigeria. The researcher adopted the survey strategy and use structured questionnaire to collect data. The data was sourced from the Federal Inland Revenue Service (FIRS)in AkwaIbom State. The data was collected from the entire population of the staff at the FIRS, which was forty (40). The simple percentage, descriptive statistics, and linear regression techniques were used to analyze the data. The results suggest that tax compliance is negatively influenced when economy is digitalised. It is therefore recommended that the government of Nigeria should consider developing tax policy that would aid taxing e-transactions, tax education and including taxation of e-transactions in the tax laws. Doing so would likely improve tax compliance and thus boost digital transactions contribution to government revenue.

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“…Etim et al [32], in their investigation over 19 years, determined the result of costfocused and benefit-fixed tax technique incentives on FDI in Nigeria. This was accomplished by using secondary data sourced from the CBN and World Bank data sets via multiple regression strategies.…”

Section: Literature Review and Research Questionsmentioning

confidence: 99%

Impact of Tax Incentives on Foreign Direct Investment: Evidence from Africa

et al. 2021

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African countries have faced competition and several challenges to attract foreign direct investment given the role that FDIs play in the development process. Several efforts made have been futile because of numerous factors that play against the business environment for foreign investments. Our paper analyses the influence of tax incentives on foreign direct investment in African economies based on data from 2000–2018. We utilized panel data on forty (40) African countries and an econometric model of four proxies of tax incentives, after controlling other variables, with robust Random Effect as our discussion estimator. Our results revealed that FDI responds to lower corporate income tax (CTR). Furthermore, foreign direct investment predominates in African economies with longer tax holidays and withholding tax. However, tax concession is insignificant to the inflows of FDIs in Africa. Summarizing, our results recommend that without proper restructuring of the tax incentives to deal with policy lapses by the governments of Africa, achieving the four main goals, i.e., poverty eradication, sustainable growth and development, African integration in the competitive global economy, and women empowerment, will be hindered.

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Attracting Foreign Direct Investment (FDI) In Nigeria through Effective Tax Policy Incentives

Cited by 16 publications

References 5 publications

Modelling the synergy between fiscal incentives and foreign direct investment in Ghana

Modelling the synergy between fiscal incentives and foreign direct investment in Ghana

Tax Compliance and Digitalization of Nigerian Economy: The Empirical Review

Impact of Tax Incentives on Foreign Direct Investment: Evidence from Africa

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