Effects of tax incentives on the performance of export processing zone firms in Kenya: a case of Athi River export processing zone.

Simple item page
dc.contributor.authorPaul, Jane Betty
dc.date.accessioned2020-03-04T09:29:18Z
dc.date.accessioned2022-06-07T06:48:12Z
dc.date.available2020-03-04T09:29:18Z
dc.date.available2022-06-07T06:48:12Z
dc.date.issued2019
dc.descriptionPROJ 338.973 PAUen_US
dc.description.abstractMost governments in this world use trade policies and programs to facilitate trade. This has led to the introduction of several trade related incentives. Export processing zones were introduced in Kenya in 1990 under the EPZ Act 1990, CAP 517 Laws of Kenya to present the opportunity for the country’s development and economic growth. This study intended to establish the effect of tax incentives on the performance of Export Processing Zone firms in Kenya. Precisely, it analyzed the various types of tax incentives offered to EPZ firms which directly or indirectly affect performance. Performance was gauged by job creation, skills or technology transfer and foreign exchange earnings. This study adopted a case study design, with Athi River EPZ being suitable for the study as it houses 69 firms in Kenya. Primary data was collected using questionnaires. This study used panel data and pooled panel regression model in testing the significance of the effect of the independent variables on the dependent variable. Descriptive data analysis was also used in conducting data analysis. From the analysis, 89% of the respondents noted that corporate income tax has an effect on performance of EPZ Firms while 11% said it has no effects. 84%, of the respondents said that withholding tax incentive affects the performance while 16% said it has no effect. 78% of the respondents stated that duty exemption affects performance of EPZ firms while 22% said it has no effect. On capital allowance 89% of the respondents stated that it affects the performance while 11% said it does not affect the performance of EPZ Firms in Kenya. The results of multivariate regression model further revealed that corporate income tax incentive had a positive and significant relationship with performance of EPZ firms measured using the number of jobs. The results of bivariate regression models adopted revealed that at 5% significance level corporate income tax incentive, capital allowance tax incentive, duty exemption and withholding tax as well as a positive and significant relationship with performance of EPZ firms measured using technology, foreign exchange and the total number of jobs. The study found out that Firm size moderate the relationship between tax incentives and the performance of EPZ firms in Kenya. The study conducted analysis on the EPZ firms to find out the survival rate of the EPZ after 7 years period of tax holiday. Within this 7 year period EPZ firms benefit from tax incentives available. This finding implies that tax incentives may be valuable in attracting EPZ firms but the performance of these firms depends on other factors different from tax incentives. Based on the findings the study concluded that the government should continue to offer tax exemptions for it to attract and maintain foreign investors in the country. This study recommends that stakeholders in tax policy should reconsider the economic value of corporate tax incentive .The nature of the study called for an emphasis on confidential information related to the manufacturing firms. Disclosure of such confidential information made the respondents feel intruded and hence they were assured of confidentiality and ethical handling of the information they provided.en_US
dc.identifier.urihttps://ikesra.kra.go.ke/handle/123456789/701
dc.language.isoenen_US
dc.publisherKESRA/JKUAT - Unpublished research projecten_US
dc.subjectDuty exemptionsen_US
dc.subjectWithholding tax holiday incentiveen_US
dc.subjectTax incentiveen_US
dc.titleEffects of tax incentives on the performance of export processing zone firms in Kenya: a case of Athi River export processing zone.en_US
dc.typeProjectsen_US

Files

Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
Effects of tax incentives on the performance of export processing zone firms in Kenya a case of Athi River export processing zone..pdf
Size:
1.19 MB
Format:
Adobe Portable Document Format
Description:
Research Project
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
1.7 KB
Format:
Plain Text
Description:
Download

Collections

4.2019