Determinants of tax incentives for investment activity of enterprises

Viktor V. Ivanov, Nadezhda A. Lvova, Natalia V. Pokrovskaia, Svetlana V. Naumenkova


The article is devoted to the problematic issues of tax incentives for Russian companies. The main prerequisite of the research is that the domestic practice of tax incentives does not meet the interests of the state, since it is in clear contradiction with the declared principles of economic development. The provided tax privileges should promote the investment activity of business. However, tax incentives are often offered to those enterprises that are not able to use them effectively. Justification of tax benefits requires identifying enterprise’s investment activity factors, the level of which is largely determined by the corporate life cycle stage and industry specificity. Hypotheses about the importance of corporate age and economic activity, formulated for the purposes of this study, have been empirically confirmed. It was proved that the investment activity of Russian enterprises demonstrated different dynamics in the conditions of the economic crisis. In the manufacturing industry, in particular, most enterprises increased the volume of fixed assets, while in the spheres of petroleum products, dairy products, chemical products, communications on the basis of wire technologies, there was a decline in investment activity. The change in investment activity in the period under study was due to various factors for both enterprises of different industries and enterprises of the same industry characterized by different corporate ages. The results obtained let us conclude that a unified approach to tax incentives for enterprises’ investment activity cannot be justified. In the opinion of the authors, “targeted” tools of tax incentives are more efficient.


1. Tax incentives should meet the interests of the state, contributing to the development of the economy. However, in Russia it is increasingly reduced to tax benefits, which increase in volume, but do not bring the desired effect, including the fact that they do not contribute to the growth of investment activity of enterprises

2. It was revealed that the investment activity of the enterprise depends to a significant extent on the stage of the life cycle and industry specificity, which, in the opinion of the authors, should be considered as the determinants of tax incentives. Accordingly, the authors offer the hypotheses about the importance of the corporate age and the sphere of financial and economic activity in shaping the factors of Russian enterprise investment activity

3. Investment activity models for young, adult and old manufacturing enterprises, as well as companies for the manufacture of coke and refined petroleum products, dairy products, chemicals and chemical products, and communications based on wire technologies have been constructed. It is shown that these models have independent significance, and the factors of investment activity really depend on the corporate age and industry specificity

4. Thus, it is argued that the system of tax incentives in Russia requires development: we should abandon unsystematic tax incentives in favor of target instruments that take into account the financial characteristics of the taxpayer more flexibly

For citation 

Ivanov V. V., Lvova N. A., Pokrovskaia N. V. Naumenkova S. V. Determinants of tax incentives for investment activity of enterprises. Journal of Tax Reform, 2018, vol. 4, no. 2, pp. 125–141. DOI: 10.15826/jtr.2018.4.2.048

Article info 

Received June 9, 2018; accepted July 22, 2018


Налоговое стимулирование, налоговые льготы, инвестиционная активность, инвестиции, жизненный цикл организации


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Copyright (c) 2018 Viktor V. Ivanov, Nadezhda A. Lvova, Natalia V. Pokrovskaia, Svetlana V. Naumenkova

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