Financial Attributes and Tax Planning of Selected listed Manufacturing Companies in Nigeria
The study examined the effect of financial attributes on tax planning of selected listed manufacturing companies in Nigeria. Ex post facto research design was employed for the study. The population of the study was 34 manufacturing companies from consumer and industrial goods sector listed on the Nigeria Exchange Group. The study sampled twenty manufacturing companies using judgmental. The independent variables used include profitability, liquidity, financial leverage and firm growth. Tax planning was the dependent variable for the study proxied by effective tax rate. Firm size was used as the control variable. Data was collected from the annual reports of the sampled companies from 2014 – 2023 (10 years). Descriptive statistics, correlation and fixed effect robust regression was employed for the study. Findings showed that Liquidity and financial leverage had a significant and positive effect on tax planning. Profitability and growth had an insignificant and positive effect on tax planning. The study concluded that liquidity and financial leverage are crucial factors influencing tax planning in the Nigerian manufacturing sector, as firms leverage their cash reserves and debt structures to optimize tax strategies, ultimately improving their financial performance. The study recommended amongst others that the management of the companies should focus on optimizing liquidity management practices such as maintaining adequate cash reserves, managing working capital efficiently, and accessing sources of liquidity, such as to enhance their ability to effectively engage in tax planning. Given the significant relationship between liquidity and tax planning, firms should integrate tax considerations into their overall financial strategy.
Keywords: Profitability, Liquidity, Financial Leverage, Firm Growth and Tax Planning
Citation: Aondoakaa, K., Iorpev, L., Akpa, C., & Gbulum, T.T. (2025). Financial Attributes and Tax Planning of Selected listed Manufacturing Companies in Nigeria. International Journal of Innovative Research in Accounting and Sustainability, 10(1), 24-33.