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Corporate Tax Avoidance Practices: An Empirical Evidence from Nigerian Firms

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  • Adegbite Tajudeen Adejare

    (Al-Hikmah University, Nigeria)

  • Bojuwon Mustapha

    (Fountain University, Osun State)

Abstract

This study examined the existence of corporate tax avoidance practices among the public listed firms in Nigeria. Secondary data were obtained from annual published reports from selected Nigerian firms listed in Nigeria stock exchange from 2006 to 2017. Panel Data analysis technique was used to analyse the effect of independent variables (Thin capitalization, Leverage, Firms Size, Transfer Pricing, and Intangible Assets) on dependent variable (Corporate Tax Avoidance). The result showed that thin capitalisation, firm size, profitability, leverages, intangible assets, and transfer pricing are significantly related with corporate tax avoidance. Thin capitalisation, profitability and transfer pricing are the primary driver of corporate tax avoidance. It is concluded that there are several corporate tax avoidance practices employed by Nigerian firms to aggressively reduce their corporate tax liabilities in Nigeria.

Suggested Citation

  • Adegbite Tajudeen Adejare & Bojuwon Mustapha, 2019. "Corporate Tax Avoidance Practices: An Empirical Evidence from Nigerian Firms," Studia Universitatis Babeș-Bolyai Oeconomica, Sciendo, vol. 64(3), pages 39-53, December.
    • Handle: RePEc:vrs:subboe:v:64:y:2019:i:3:p:39-53:n:3
    DOI: 10.2478/subboec-2019-0014
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    References listed on IDEAS

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    More about this item

    Keywords

    Tax Avoidance; Thin capitalization; Leverage; Firms Size; Transfer Pricing; Intangible Assets;
    All these keywords.

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • H29 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity

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