DOES TAXATION HAS IMPACT ON INVESTMENT? AN EMPIRICAL RESPONSE FROM CO-INTEGRATION ANALYSIS
DOES TAXATION HAS IMPACT ON INVESTMENT? AN EMPIRICAL RESPONSE FROM CO-INTEGRATION ANALYSIS

Summary/Abstract: This study examined the effect of taxation on investment in Nigeria from 1970to 2018. Relevant secondary data were obtained from Central Bank of Nigeria(CBN) Statistical Bulletins and Federal Inland Revenue Services Bulletin from1970 to 2018. Regression analysis technique, Units root test, Johansen cointegration, Vector Error-Correction Model, and Granger causality tests wereemployed to determine the long run relationship and causality links among thevariables. Results showed that PPT and Value added tax had positive significantimpact on INV both in the short run and in the long run while Company incometax, and Custom and Excise duties impacted INV negatively. It is concluded thatall components of taxes had positive significant impact on investment in Nigeriaexcept corporate income tax. Corporate income tax had negative significantimpact on investment both in the short run and in the long run.

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