Corporate Ownership Structure and Aggressive Tax Planning Practice among Non-Financial Firms in Nigeria

Abstract

Some companies employ aggressive tax planning practices majorly to minimize their tax liability. This study has chosen to investigate the correlation between corporate ownership and aggressive tax planning practices among non-financial firms in Nigeria. Three hypotheses were formulated in line with the objectives of the study. The study expost facto research design and used secondary data. The research covers the ninety two (92) firms listed under no- financial sector on the Nigerian Exchange group. Secondary data were collected from the financial statements of the firms which spanned from 2017 to 2021. The data were analysed with descriptive statistics, correlation and mixed-effect ML regression analysis. The results therefrom indicate that managerial ownership has significant relationship with aggressive tax planning practice. Additionally ownership concentration has significant association with aggressive tax planning while the last outcome indicated an insignificant link between foreign ownership and aggressive tax planning. The study recommends among other things that the Firms in Nigeria should prioritize transparency and disclosure of their tax planning practices, and regulatory authorities in Nigeria should consider implementing stricter oversight and monitoring of tax planning activities, particularly in firms with high managerial ownership, foreign ownership, or concentrated ownership structures.