Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria

Babatayo Kolawole Olayemi; Adegbie Festus Folajimi

doi:doi:10.11648/j.ijdst.20210701.11

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Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria

Babatayo Kolawole Olayemi, Adegbie Festus Folajimi

Published in International Journal on Data Science and Technology (Volume 7, Issue 1)

Received: 20 August 2020 Accepted: 11 September 2020 Published: 4 January 2021

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Abstract

The growth of Small and Medium Scale Enterprises (SMEs) had been considered a vital factor in the economic development of any country especially with regard to creation of employment and contribution to the growth of Gross Domestic Product. The growth of SMES was however hindered by challenges ranging from the lack of financial resources to expand, inadequate infrastructural facilities, lack of support from the government, harsh business environment, and above all, unpleasant taxation policy of the government creating enormous tax burdens to the SMEs. Tax Incentives had been perceived to influence the growth of small and medium enterprises (SMEs). In the light of all these, this paper reviewed the effect of tax incentives on the growth in sales revenue of Small and Medium Enterprises in Ondo and Ekiti States, Nigeria. The study employed survey design. The study population comprised SMEs registered with Small and Medium Enterprise Development Agency of Nigeria in Ondo and Ekiti States, with the total of 2,708. The Taro Yamane formula was used to obtain a sample size of 386. The owners/managers, employees, accountants and auditors of these SMEs were selected through a multi-stage sampling technique which involved the stratified, proportionate, and simple random sampling methods. Descriptive and inferential statistics were used to analyse the data. The results showed tax incentives (investment allowance, tax holiday, tax credit and tax deferment) have a significant positive effect on the growth in sales revenue of SMEs, F₆₇₉=313.815, Adj. R²=0.759, p-value=0.000<0.05. Hence, the study concluded that tax incentives proxies, of investment allowance, tax holiday, tax credit and tax deferment were significant determinants of the growth in sales revenue of SMEs in Ondo and Ekiti States, Nigeria.

Published in	International Journal on Data Science and Technology (Volume 7, Issue 1)
DOI	10.11648/j.ijdst.20210701.11
Page(s)	1-16
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2021. Published by Science Publishing Group

Keywords

Sales Revenue, Investment Allowance, Tax Credit, Tax Deferment, Tax Holiday

References

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Babatayo Kolawole Olayemi, Adegbie Festus Folajimi. (2021). Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. International Journal on Data Science and Technology, 7(1), 1-16. https://doi.org/10.11648/j.ijdst.20210701.11

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ACS Style

Babatayo Kolawole Olayemi; Adegbie Festus Folajimi. Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. Int. J. Data Sci. Technol. 2021, 7(1), 1-16. doi: 10.11648/j.ijdst.20210701.11

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AMA Style

Babatayo Kolawole Olayemi, Adegbie Festus Folajimi. Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. Int J Data Sci Technol. 2021;7(1):1-16. doi: 10.11648/j.ijdst.20210701.11

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@article{10.11648/j.ijdst.20210701.11,
  author = {Babatayo Kolawole Olayemi and Adegbie Festus Folajimi},
  title = {Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria},
  journal = {International Journal on Data Science and Technology},
  volume = {7},
  number = {1},
  pages = {1-16},
  doi = {10.11648/j.ijdst.20210701.11},
  url = {https://doi.org/10.11648/j.ijdst.20210701.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijdst.20210701.11},
  abstract = {The growth of Small and Medium Scale Enterprises (SMEs) had been considered a vital factor in the economic development of any country especially with regard to creation of employment and contribution to the growth of Gross Domestic Product. The growth of SMES was however hindered by challenges ranging from the lack of financial resources to expand, inadequate infrastructural facilities, lack of support from the government, harsh business environment, and above all, unpleasant taxation policy of the government creating enormous tax burdens to the SMEs. Tax Incentives had been perceived to influence the growth of small and medium enterprises (SMEs). In the light of all these, this paper reviewed the effect of tax incentives on the growth in sales revenue of Small and Medium Enterprises in Ondo and Ekiti States, Nigeria. The study employed survey design. The study population comprised SMEs registered with Small and Medium Enterprise Development Agency of Nigeria in Ondo and Ekiti States, with the total of 2,708. The Taro Yamane formula was used to obtain a sample size of 386. The owners/managers, employees, accountants and auditors of these SMEs were selected through a multi-stage sampling technique which involved the stratified, proportionate, and simple random sampling methods. Descriptive and inferential statistics were used to analyse the data. The results showed tax incentives (investment allowance, tax holiday, tax credit and tax deferment) have a significant positive effect on the growth in sales revenue of SMEs, F679=313.815, Adj. R2=0.759, p-value=0.000. Hence, the study concluded that tax incentives proxies, of investment allowance, tax holiday, tax credit and tax deferment were significant determinants of the growth in sales revenue of SMEs in Ondo and Ekiti States, Nigeria.},
 year = {2021}
}

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TY  - JOUR
T1  - Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria
AU  - Babatayo Kolawole Olayemi
AU  - Adegbie Festus Folajimi
Y1  - 2021/01/04
PY  - 2021
N1  - https://doi.org/10.11648/j.ijdst.20210701.11
DO  - 10.11648/j.ijdst.20210701.11
T2  - International Journal on Data Science and Technology
JF  - International Journal on Data Science and Technology
JO  - International Journal on Data Science and Technology
SP  - 1
EP  - 16
PB  - Science Publishing Group
SN  - 2472-2235
UR  - https://doi.org/10.11648/j.ijdst.20210701.11
AB  - The growth of Small and Medium Scale Enterprises (SMEs) had been considered a vital factor in the economic development of any country especially with regard to creation of employment and contribution to the growth of Gross Domestic Product. The growth of SMES was however hindered by challenges ranging from the lack of financial resources to expand, inadequate infrastructural facilities, lack of support from the government, harsh business environment, and above all, unpleasant taxation policy of the government creating enormous tax burdens to the SMEs. Tax Incentives had been perceived to influence the growth of small and medium enterprises (SMEs). In the light of all these, this paper reviewed the effect of tax incentives on the growth in sales revenue of Small and Medium Enterprises in Ondo and Ekiti States, Nigeria. The study employed survey design. The study population comprised SMEs registered with Small and Medium Enterprise Development Agency of Nigeria in Ondo and Ekiti States, with the total of 2,708. The Taro Yamane formula was used to obtain a sample size of 386. The owners/managers, employees, accountants and auditors of these SMEs were selected through a multi-stage sampling technique which involved the stratified, proportionate, and simple random sampling methods. Descriptive and inferential statistics were used to analyse the data. The results showed tax incentives (investment allowance, tax holiday, tax credit and tax deferment) have a significant positive effect on the growth in sales revenue of SMEs, F679=313.815, Adj. R2=0.759, p-value=0.000. Hence, the study concluded that tax incentives proxies, of investment allowance, tax holiday, tax credit and tax deferment were significant determinants of the growth in sales revenue of SMEs in Ondo and Ekiti States, Nigeria.
VL  - 7
IS  - 1
ER  -

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Babatayo Kolawole Olayemi

Department of Accounting, Babcock University, Ilishan Remo, Nigeria
Adegbie Festus Folajimi

Department of Accounting, Babcock University, Ilishan Remo, Nigeria

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Babatayo Kolawole Olayemi, Adegbie Festus Folajimi. (2021). Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. International Journal on Data Science and Technology, 7(1), 1-16. https://doi.org/10.11648/j.ijdst.20210701.11

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ACS Style

Babatayo Kolawole Olayemi; Adegbie Festus Folajimi. Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. Int. J. Data Sci. Technol. 2021, 7(1), 1-16. doi: 10.11648/j.ijdst.20210701.11

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AMA Style

Babatayo Kolawole Olayemi, Adegbie Festus Folajimi. Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria. Int J Data Sci Technol. 2021;7(1):1-16. doi: 10.11648/j.ijdst.20210701.11

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@article{10.11648/j.ijdst.20210701.11,
  author = {Babatayo Kolawole Olayemi and Adegbie Festus Folajimi},
  title = {Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria},
  journal = {International Journal on Data Science and Technology},
  volume = {7},
  number = {1},
  pages = {1-16},
  doi = {10.11648/j.ijdst.20210701.11},
  url = {https://doi.org/10.11648/j.ijdst.20210701.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijdst.20210701.11},
  abstract = {The growth of Small and Medium Scale Enterprises (SMEs) had been considered a vital factor in the economic development of any country especially with regard to creation of employment and contribution to the growth of Gross Domestic Product. The growth of SMES was however hindered by challenges ranging from the lack of financial resources to expand, inadequate infrastructural facilities, lack of support from the government, harsh business environment, and above all, unpleasant taxation policy of the government creating enormous tax burdens to the SMEs. Tax Incentives had been perceived to influence the growth of small and medium enterprises (SMEs). In the light of all these, this paper reviewed the effect of tax incentives on the growth in sales revenue of Small and Medium Enterprises in Ondo and Ekiti States, Nigeria. The study employed survey design. The study population comprised SMEs registered with Small and Medium Enterprise Development Agency of Nigeria in Ondo and Ekiti States, with the total of 2,708. The Taro Yamane formula was used to obtain a sample size of 386. The owners/managers, employees, accountants and auditors of these SMEs were selected through a multi-stage sampling technique which involved the stratified, proportionate, and simple random sampling methods. Descriptive and inferential statistics were used to analyse the data. The results showed tax incentives (investment allowance, tax holiday, tax credit and tax deferment) have a significant positive effect on the growth in sales revenue of SMEs, F679=313.815, Adj. R2=0.759, p-value=0.000. Hence, the study concluded that tax incentives proxies, of investment allowance, tax holiday, tax credit and tax deferment were significant determinants of the growth in sales revenue of SMEs in Ondo and Ekiti States, Nigeria.},
 year = {2021}
}

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TY  - JOUR
T1  - Tax Incentives and the Growth in Sales Revenue of Small and Medium Enterprises (SMEs) in Ondo and Ekiti States, Nigeria
AU  - Babatayo Kolawole Olayemi
AU  - Adegbie Festus Folajimi
Y1  - 2021/01/04
PY  - 2021
N1  - https://doi.org/10.11648/j.ijdst.20210701.11
DO  - 10.11648/j.ijdst.20210701.11
T2  - International Journal on Data Science and Technology
JF  - International Journal on Data Science and Technology
JO  - International Journal on Data Science and Technology
SP  - 1
EP  - 16
PB  - Science Publishing Group
SN  - 2472-2235
UR  - https://doi.org/10.11648/j.ijdst.20210701.11
AB  - The growth of Small and Medium Scale Enterprises (SMEs) had been considered a vital factor in the economic development of any country especially with regard to creation of employment and contribution to the growth of Gross Domestic Product. The growth of SMES was however hindered by challenges ranging from the lack of financial resources to expand, inadequate infrastructural facilities, lack of support from the government, harsh business environment, and above all, unpleasant taxation policy of the government creating enormous tax burdens to the SMEs. Tax Incentives had been perceived to influence the growth of small and medium enterprises (SMEs). In the light of all these, this paper reviewed the effect of tax incentives on the growth in sales revenue of Small and Medium Enterprises in Ondo and Ekiti States, Nigeria. The study employed survey design. The study population comprised SMEs registered with Small and Medium Enterprise Development Agency of Nigeria in Ondo and Ekiti States, with the total of 2,708. The Taro Yamane formula was used to obtain a sample size of 386. The owners/managers, employees, accountants and auditors of these SMEs were selected through a multi-stage sampling technique which involved the stratified, proportionate, and simple random sampling methods. Descriptive and inferential statistics were used to analyse the data. The results showed tax incentives (investment allowance, tax holiday, tax credit and tax deferment) have a significant positive effect on the growth in sales revenue of SMEs, F679=313.815, Adj. R2=0.759, p-value=0.000. Hence, the study concluded that tax incentives proxies, of investment allowance, tax holiday, tax credit and tax deferment were significant determinants of the growth in sales revenue of SMEs in Ondo and Ekiti States, Nigeria.
VL  - 7
IS  - 1
ER  -

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