EconPapers    
Economics at your fingertips  
 

Tax Incentives and the Flow of Foreign Direct Investment to Non-Oil Sector: Empirical

Joseph Amuka () and Fidelis Ezeudeka
Additional contact information
Fidelis Ezeudeka: Federal Inland Revenue Service Abuja-Nigeria, Nigeria

Asian Journal of Social Sciences and Management Studies, 2017, vol. 4, issue 1, 57-64

Abstract: Foreign Direct Investment has become an important source of bridging the gap between domestic savings and domestic investments in developing countries in the past three decades. In order to increase the flow of foreign direct investment, Nigeria like many other developing countries reformed her tax system in late 1990s to create incentives for the flow of foreign direct investment into the country. She reviewed company income tax downward from 50% in 1980s to 30% in 1999. Similarly, investment allowance was reviewed upward from 25% in 1980s to 95% in 1999. This study investigated whether the incentive policy has brought any significant change in the pattern of flow of foreign direct investment to the non-oil sector. The study adopted a multiple regression model which was transformed into log-log model in the analysis. Regime switch model helped us to evaluate the effectiveness of the policy introduced in late 1999. Both company income tax and investment allowance appeared with the right sign. Result suggests that the tax incentive policy introduced changed the flow of foreign investment to the non-oil sector, showing that the country’s tax incentives can help revive the ailing non-oil sector.

Keywords: Tax incentives; Foreign direct investment; Non-oil sector. (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.asianonlinejournals.com/index.php/AJSSMS/article/view/806/pdf (application/pdf)
http://www.asianonlinejournals.com/index.php/AJSSMS/article/view/806 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aoj:ajssms:2017:p:57-64

Access Statistics for this article

Asian Journal of Social Sciences and Management Studies is currently edited by Sara Lim

More articles in Asian Journal of Social Sciences and Management Studies from Asian Online Journal Publishing Group 2885 Sanford Ave SW #43110 Grandville, MI 49418, USA.
Bibliographic data for series maintained by Sara Lim ().

 
Page updated 2021-09-13
Handle: RePEc:aoj:ajssms:2017:p:57-64