TAX PLANNING STRATEGIES AND FINANCIAL PERFORMANCE OF LISTED PHARMACEUTICAL COMPANIES IN NIGERIA
Abstract
The study examined tax planning strategies and financial performance of listed pharmaceutical companies in Nigeria. The objectives of the study among others where; examine the relationship between capital intensity and profit after tax of listed pharmaceutical companies in Nigeria. assess
the relationship between effective tax rate and profit after tax of listed pharmaceutical companies in Nigeria. determine the moderating effect of firm size on the relationship between tax planning
strategies and financial performance of listed pharmaceutical companies in Nigeria. the study employed an ex-post-facto and correlational research design. The population and sample size of this study consisted of 7 listed Pharmaceutical (Healthcare) companies on the Nigeria Exchange Group from (2006 – 2020). The instrumentation was secondary data, The formulated research questions were analyzed with descriptive statistics. The hypotheses were tested using the Ordinary
Least Square (OLS) Model regression analysis with the aid of E-view (10). Findings of the study were that that there is no significant relationship between capital intensity and profit after tax of listed pharmaceutical companies in Nigeria. there is a significant relationship between effective tax rate and profit after tax of listed pharmaceutical companies in Nigeria. Firm Size does not significantly influence the relationship between Tax Planning Strategies and the Financial Performance of listed Pharmaceutical Companies in Nigeria. Based on the findings of the study, it is recommended that firms should ensure that proper analysis of strategies, cost, and benefits therefrom is done before embarking on it. Also, as a major to reduce abuse of privileges, shelters and loopholes in the tax law, the revenue should ensure less complexity in the tax law and regulations. the existence of a significant relationship between effective tax rates and measures of financial performance in this study is an indication that companies can maximize effective tax rates in order to improve their financial performance.
