EFFECT OF FIRM ATTRIBUTES ON TAX AGGRESSIVENESS OF QUOTED COMMERCIAL BANKS NIGERIA

Abstract

This study assessed the effect of firm size, profitability, liquidity and leverage on tax aggressiveness in the Nigerian banking sector. The population of the study consists of fifteen (14) Deposit Money Banks (DMBs) whose shares were listed on the Nigerian Stock Exchange as of 31^st December 2021, from which a sample size of ten (10) banks was selected using the judgmental technique based on Banks with international authorization. The secondary source of data collection method was used to generate data from the ten (10) annual financial statements of the sampled banks for a period of five years (2017- 2021). Data generated from the annual reports and accounts were analysed using descriptive statistics and Ordinary Least Square (OLS) regression. Our findings revealed that firm size, leverage, and liquidity have a significant effect on tax aggressiveness while profitability has an insignificant effect on tax aggressiveness in the Nigerian banking sector. The study concluded that firm characteristics are reliable operating mechanisms for predicting the level of aggressive tax planning in the Nigerian banking sector. From the findings and conclusion, the study recommended that the drive for tax policy in the banks should focus on the expansion of assets and creating more value for the banks. The initial focus of tax authorities should be on creating a tax culture amongst the people, not on maximizing revenue or enforcing stringent compliance measures. Finally, the Federal Inland Revenue Service and its states counterparts should further be strengthened to reposition them for better service delivery through more manpower, better training of personnel and adequate funding for more administrative control.