THE NEXUS BETWEEN COMPANY INCOME TAX ON FIRM’S PROFITABILITY – EVIDENCE FROM THE CONSUMER GOOD COMPANIES IN NIGERIA
Abstract
This paper analyzed the influence of Company Income Tax on Firms’ Profitability in the consumer goods sector of the Nigerian economy. The study employed secondary data obtained from the published financial statements of the fifteen (15) chosen consumer goods companies quoted on the Nigerian Stock Exchange (NSE). The data sets used were; Profit after Tax (PAT), Company Income Tax (CIT), Firm Size (FMS) and Net Asset (NEA) for the considered period of 2012 to 2018 which represented the scope of the study. A Panel Fully Modified Ordinary Least Square (FMOLS) model approach was adopted in analyzing the collected data and the result from the analysis indicates that company income tax has a positive and significant influence on profit after tax in consumer goods sector of the economy. It is therefore recommended that companies should pay special attention to payment of taxes as it has a significant influence on their profitability which can also be used to improve corporate image.
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