Tax Savings Strategies and Value of Listed Manufacturing Firms in Nigeria: The Moderating Effect of Ceo Share Ownership
Abstract
Although tax-saving tactics have the potential to increase firm value, there is conflicting empirical evidence regarding their efficacy, particularly in developing nations like Nigeria where corporate governance and tax compliance practices diverge greatly from those in developed nations. This study's primary goal was to investigate, while taking into account the moderating influence of CEO share ownership, the relationship between corporate tax savings strategies and the value of listed manufacturing firms in Nigeria. Earnings yield served as a stand-in for the dependent variable, firm value, while cash effective tax rate, income effective tax rate, non-debt tax shield, and debt tax savings served as proxies for the independent variable, corporate tax savings strategy. Using data from a subset of manufacturing companies listed on the Nigerian Exchange Group between 2014 and 2023, the study employed an ex post facto research design. Using a purposive sampling technique, 20 of the 59 listed manufacturing companies that made up the study population were chosen as the sample size. Secondary sources, mainly annual financial reports, provided the data. Regression analysis was used as part of the data analysis process to examine the connections between the variables. SPSS version 24 was the statistical program used. The results showed that the cash effective tax rate and earnings yield had a statistically significant negative relationship, the income effective tax rate and earnings yield had a non-significant relationship, the non-debt tax shield and earnings yield had a statistically significant positive relationship, and the debt tax shield and earnings yield had a significant negative relationship. Furthermore, it was discovered that the relationship between debt tax saving strategy and firm value was significantly positively moderated by the CEO's share ownership. The study came to the conclusion that tax-saving tacti
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