Education Tax Effect on Firms’ Value of Consumer Products Industries in Nigeria

Abstract

This study is to determine the effect of education tax on firms’ value of firms in the Consumer products industry in Nigeria. Education tax represents independent variable while return on investment, return in equity and earnings per share concentration on firms value of Consumer products companies. Random sampling technique was used in selecting a sample of five (5) out of nineteen (19) Consumer products companies for the study. The study adopts the ex-facto research design which resulted in the extraction of data from secondary sources; such as audited corporate annual reports of beverage industries and Nigeria Stock Exchange fact book. Data collected were analyzed using descriptive statistics, correlation and regression analysis. Hypotheses testing were done with linear regression analytical techniques using SPSS analytical software package. The results indicated that Education tax has insignificant but positive effect on return on investment of sampled consumer products industry in Nigeria while Education tax has a significant but positive effect on return on equity of sampled consumer products industry in Nigeria and Education tax has a significant but positive effect on earnings per share of sampled consumer products industry in Nigeria. The policy implication is that education tax is good predictors of financial performance. The consumer product industries, must strive to improve their generated sales revenue and other source like investing in profitable tangible and non-tangible asset. Consequently, it is recommended that government should provide and enabling environment for companies increase their return on investment, firms of consumer products industry should be sure of a positive return on investment otherwise other opportunities with return should be considered. Government should also reduce the education tax rate to encourage return on equity of consumer products industry in Nigeria and consumer product firms should strive high t