Impact of Tax Reduction Policy on Banking Sector in Pakistan

Khalid Mahmood Lodhi

Information Management and Business Review, 2011, vol. 3, issue 6, 373-382

Abstract: This study analyzes the impact of tax policy reforms on the profits of banking sector. The empirical results of unit root and Augmented Dickey Fuller (ADF) test reveal that the data series of tax is positively skewed whereas data series of profitability is negatively skewed. The kurtosis value indicates that all the series are platykurtic. From the value of ADF statistics, it is evident that all the variables are non-stationery at log level and are stationary at their first difference. Granger Causality Test shows that profitability of banking does not granger because tax but tax granger cause profitability of banking which depicts that the change in tax rate affects the profitability of banking industries. The study finds that reduction in corporate income tax rates for banking sector has produced positive impact in shape of increased banking sector profits and assets during the period under review.

Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ojs.amhinternational.com/index.php/imbr/article/view/954/954 (application/pdf)
https://ojs.amhinternational.com/index.php/imbr/article/view/954 (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:rnd:arimbr:v:3:y:2011:i:6:p:373-382

DOI: 10.22610/imbr.v3i6.954

Access Statistics for this article

More articles in Information Management and Business Review from AMH International
Bibliographic data for series maintained by Muhammad Tayyab ().