Non-Current Asset And Taxpayable: Evidence Of Compatibility From Manufacturing Companies

Abstract

Persistent investment in non-current assets by manufacturing companies enhances product capacity and competitiveness as the government emphasizes industrialization which invariably affect their profitability and productivity. Procurement of new non-current asset has created vacuum for the manufacturing companies for reduction in tax payable. Therefore, this study investigated the impact of non-current assets on tax payable by Nigerian listed manufacturing companies.  The annual published reports of twenty chosen companies served as the source of the data. Tax payable, and motor vehicle, furniture and fittings, plant and machinery, and buildings were engaged as dependent and independent variables respectively. Capital allowances and firm size were engaged as the control variable, which were analyzed with panel pooled regression analysis, correlation, fixed effect, and random effect together with Hausman test. Based on results from data analytical tools, it was discovered that furniture and fittings buildings, motor vehicle, and plant and machinery significantly downplay tax payable. In conclusion, Nigerian manufacturing companies' tax payable are negatively and significantly impacted by their non-current assets in Nigeria manufacturing companies. It is recommended that government should authoritatively and digitally monitoring the procurement of Noncurrent assets and the extant noncurrent assets to avoid irrational clamming of capital allowance, and to tremendously enhance tax payable by Nigeria manufacturing companies. Keywords: Non-current assets; Tax payable; Plant and machinery; Furniture and fittings; Motor vehicles; Building; capital allowance