DETERMINANTS OF TAX AGGRESSIVENESS AMONG NON-FINANCIAL LISTED FIRMS IN NIGERIA

Abstract

The study investigated the determinants of tax aggressiveness among Nigerian listed non-financial firms using inferential and descriptive statistics. Ex-post facto research design was used based on the researchers’ choice of relying on secondary data of listed non-financial enterprises in order to meet the study's general and specific objectives. For this study, 10 years company-specific data were collected from MachameRatios Positive Accounting Database covering 2011 to 2020. Analysis was done using the regression method along with relevant diagnostic tests. According to the results of the hypothesis test, we discovered that Return on Assets (ROA) and gender diversity on the audit committee, does not significantly influence tax aggressiveness, whereas, real earnings management and independence of corporate boards have significant impact on the level of tax aggressiveness of listed non-financial firms in Nigeria. The study thus submits that the level of board independence and the degree of managements’ involvement on real earnings management are major determinants of tax aggressiveness among Nigerian listed non-financial firms. This study thus recommends that the Financial Reporting Council of Nigeria and other relevant regulatory agencies should sustain previous provision in the corporate governance codes requiring the compulsory inclusion of independent directors in the boards of corporate entities. Conscious attempts must be made by regulators to strategically monitor the activities of corporate organizations and their respective management to the extent that tax aggressive tactics through real activities’ manipulation should be discouraged and possibly sanctioned.
 Keywords: Tax Shield, Effective Tax, Tax Aggressiveness, Non-Financial Listed Firms, Corporate Boards, Nigeria.