TAX INCENTIVES AND FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN RIVERS STATE

Authors

  • Essiet, Victor Eniema
  • Paago, Ledibabari (Ph.D)

Keywords:

Tax incentives, Financial Performance, capital allowance, tax holiday, NPM, ROI, ROA

Abstract

The study was conducted to investigate the relationship between tax incentives and financial performance in Rivers State. The study adopted nine research questions and hypotheses. The research adopted descriptive survey research design. The population for this study was two thousand, six hundred and thirty-four and a sample size of one hundred and fifty knowledgeable and competent staff of the selected small and medium scale enterprises in Rivers State.  The study used questionnaire instrument, and data were analyzed in the Statistical Package for Social Sciences Version 22. The research questions were analyzed using mean and standard deviation and hypotheses were tested using Simple bivariate regression analysis at a significance level of .05.  The results of the findings showed that there was a very strong positive significant relationship between capital allowance and measures of financial performance, also it was revealed that there is a strong positive significant relationship between investment allowance and measures of financial performance, the study further shows a strong positive relationship between tax holiday and measures of financial performance. This study recommends that the small and medium scale enterprises should adopt and comply with the tax laws provisions in order to claim the available Tax incentives in order to trigger capacity for improved performance as well as maintain a high level of net profit margin and efficiency. Small and medium scale enterprises should strengthen their database security mechanism as this is one of the major drivers in increasing Financial Performance. The Small and medium scale enterprises should continuously improve on financial management through proper record keeping, internal control system implementation and timely filing of returns, as this will go a long way in enhancing the firms’ satisfaction with easy and equal access to quality services for improving performance.

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Published

2024-04-29

How to Cite

Victor Eniema, E., & Ledibabari (Ph.D), P. (2024). TAX INCENTIVES AND FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN RIVERS STATE. BW Academic Journal. Retrieved from https://bwjournal.org/index.php/bsjournal/article/view/1872