Objectives: This study examined the effect of tax incentives on economic growth in Nigeria from 2011 to 2023. Specifically, it focused on the impact of annual allowance, investment allowance, and rural technological allowance on Gross Domestic Product (GDP).
Methodology: The study used secondary data sourced from the Central Bank of Nigeria's Statistical Bulletin. An ex-post facto research design was adopted, and multiple regression analysis, employing the Ordinary Least Squares (OLS) method, was used to analyze the data.
Findings: The analysis revealed that annual allowance had a positive and significant effect on GDP, with a t-cal of 5.509105 and a p-value of 0.0004, suggesting that annual allowance contributes positively to Nigeria's economic growth. Investment allowance showed a negative and non-significant effect on GDP, with a t-cal of -1.135036 and a p-value of 0.2857, indicating that it does not significantly impact GDP. Rural technological allowance exhibited a positive but non-significant effect on GDP, with a t-cal of 0.750729 and a p-value of 0.4720, implying it does not have a meaningful impact on GDP.
Recommendations: The government should focus on the proper management of annual allowance to improve GDP, as it has a significant positive effect. The government should not prioritize changes to investment allowance for GDP growth, since it has no significant impact. Similarly, the government should not focus on altering rural technological allowance to improve GDP, as its effect is not significant.
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