Research Article

Tax Planning Strategies and Financial Performance among Quoted Consumer Goods Companies in Nigeria

Abdulrasheed Jamiu Alabere1*, Bello Muhammed2, Rabiu Sherifdeen Adebola3, Safura Abdullahi Sikiru3
1 Department of Accounting and Finance, Kwara State University, Malete
2 Department of Accountancy, Federal Polytechnic Offa, Kwara State
3 Department of Banking and Finance, Kwara State Polytechnics, Ilorin
* Corresponding author: jamiu.abdulrasheed@kwasu.edu.ng
Published: Dec, 2024
DOI: 10.67894/bjms.2024.cu2mkut9
Pages: 166-178

Abstract

High tax rates have been a problem for consumer products companies in emerging economies, especially in Nigeria, where it has had a big effect on their financial performance. This study looks at how leverage tax planning techniques and research and development (R&D) affect the financial performance of Nigerian enterprises that manufacture consumer goods. The study, which uses cross-sectional data from 2011 to 2020 and an ex-post facto research design, covers all consumer goods companies listed on the Nigeria Stock Exchange as of December 31, 2020. The results show that the financial performance of listed consumer goods manufacturing companies in Nigeria is not considerably impacted by research and development. Moreover, conflicting findings emerge from the study of the relationship between company leverage and financial success. To potentially increase profitability, the report suggests that employers hold frequent training sessions on modern tax planning techniques for their staff. Furthermore, as interest paid on debt financing is tax deductible, using leverage as a source of financing is advised to optimize tax deductions as a way to enhance financial performance. In light of the difficult tax environments, this research provides practical suggestions to improve tax planning strategies and strengthen financial performance for Nigerian companies that manufacture consumer goods. 

Keywords

Tax Planning Technique Research and Development Firms Leverage Financial Performance and Return on Asset (ROA)

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How to Cite

Alabere, A. J., Muhammed, B., Adebola, R. S., & Sikiru, S. A. (2024). Tax Planning Strategies and Financial Performance among Quoted Consumer Goods Companies in Nigeria. Bayero Journal of Management Sciences, 6(2), 166-178. https://doi.org/10.67894/bjms.2024.cu2mkut9

A. J. Alabere, B. Muhammed, R. S. Adebola, and S. A. Sikiru, "Tax Planning Strategies and Financial Performance among Quoted Consumer Goods Companies in Nigeria," Bayero Journal of Management Sciences, vol. 6, no. 2, pp. 166-178, December 2024. doi: 10.67894/bjms.2024.cu2mkut9

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