IIARD International Institute of Academic Research and Development

IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH (IJBFR )

E-ISSN 2695-1886
P-ISSN 2672-4979
VOL. 10 NO. 1 2024
DOI: https://doi.org/10.56201/ijbfr.v10.no1.2024.pg1.15

---

Effect of Alcoholic Tax on Financial Performance of Selected Brewery Firms in Nigeria (2012-2022)

Moyotole Daniel EZUEM, Ph.D, Mrs. Barileera Victory SAGBARA, Ph.D

---

Abstract

This research delved into the impact of alcoholic taxes on the financial performance of selected brewery firms in Nigeria within the time frame of 2012 to 2022. Specifically, the study examined the influence of alcohol excise tax, alcohol price, alcohol value-added tax, and alcohol consumption on the financial performance of these brewery firms. Employing an ex post facto research design, the study utilized the general method of moments (GMM) panel least squares regression for data analysis. The findings revealed that alcohol excise tax exerted a significant negative effect on the financial performance of the brewery firms. Conversely, the alcohol price variable exhibited a significant positive impact on their financial performance. Additionally, alcohol value-added tax was found to have a negative and significant effect on the financial performance of the brewery firms. Furthermore, the study determined that alcohol consumption tax had a positive and significant effect on the financial performance of the brewery firms. Based on these results, the study recommends that brewery firms should consider pricing as a crucial element in their production function to boost revenue and profit, thereby enhancing financial performance. Furthermore, adopting a production model where consumption volume is a significant variable is advised, as it contributes positively to financial performance. Additionally, the firms are encouraged to implement strategies to recover value-added tax payments, leveraging external economies of scale and ultimately improving their financial performance.

---

References:

Abadie, A. (2021). Using synthetic controls: feasibility, data requirements, and methodological
aspects." Journal of Economic Literature 59(2): 391-425.

Abadie, A., Matthew M. C., & Martin, R. W. (2018). Endogenous stratification in randomized
experiments. Review of Economics and Statistics 100(4): 567-580.

Abadie, A., Alexis, D. & Jens, H. (2010). Synthetic control methods for comparative case
studies: Estimating the effect of California’s tobacco control program. Journal of the
American statistical Association 105(490): 493-505.

Ally, A. K., Yang, M., Ratula, C, Paul W. et al. (2014). Alcohol tax pass?through across the
product and price range: do retailers treat cheap alcohol differently? Addiction
109(12)): 1994-2002.

DOWNLOAD PDF

---

Back