OWNERSHIP STRUCTURE AND TAX AGGRESSIVENESS OF LISTED FINANCIAL FIRMS IN NIGERIA

Abstract Tax avoidance can yield substantial economic advantages, while also serves as a cost-effective means of financing. Nevertheless, engaging in aggressive tax avoidance may bring about notable tangible consequences such as fines and legal fees, as well as intangible ones like excess risk and damage to corporate reputation. This study examined the ownership structure and tax aggressiveness of listed financial firms in Nigeria, from 2012 to 2023. The population comprises all the forty-five quoted financial firms in Nigeria while filtering criteria was used to arrive at a sample size of thirty-two (32) financial firms. The hypotheses were tested using fixed effect regression model after conducting some diagnostics tests. The results showed that institutional ownership (IO) has a significant positive effect on cash effective tax rate (CETR) of quoted financial firms in Nigeria. However, ownership concentration (OC) has an insignificant negative effect on cash effective tax rate of quoted financial firms in Nigeria while managerial ownership (MO) has an insignificant positive effect on cash effective tax rate of quoted financial firms in Nigeria. The study recommends among others, that the financial firms should consider policies that promote managerial ownership. By giving managers a stake in the firm's success, their interests can be better aligned with those of the shareholders, potentially leading to more conservative and compliant tax strategies. Also, the financial firms should consider strategies to increase ownership concentration among key stakeholders, such as promoting large block holders or increasing insider ownership. Also, financial firms should align the interests of major shareholders with the company's long-term goals to promote stable and compliant tax practices

0 19 May, 2026

pg: 14

LADIRC OPEN JOURNAL SYSTEM

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