BEYOND TAX COMPLIANCE: INVESTIGATING THE NEXUS BETWEEN CORPORATE TAX LIABILITIES ON SHAREHOLDERS WEALTH MAXIMIZATION OF COMPANIES IN NIGERIA
The study investigated the relationship between corporate tax liabilities and wealth maximization of companies listed on companies in Nigeria. The dimensions of corporate tax liabilities examined were current tax liabilities (CTL) and deferred tax liabilities (DTL), while earnings per share (EPS) served as the measure of wealth maximization. An ex post facto research design was adopted, with a population comprising nine oil and gas companies on the NGX, out of which eight were purposively selected based on their compliance with regulatory requirements. Data were collected from the annual financial reports of the sampled companies for the period 2019 to 2023. The study employed both descriptive and inferential statistical analyses, including regression and correlation techniques. The regression analysis showed that CTL had a weak negative but significant relationship with EPS (β = -6.11E-07, p = 0.0485), suggesting that higher CTL reduces wealth maximization. Conversely, DTL exhibited a weak positive and significant relationship with EPS (β = 1.92E-06, p = 0.0372), indicating that deferred tax liabilities enhance financial performance. Correlation analysis supported these findings, revealing a negative correlation between CTL and EPS (r = -0.112, p = 0.0495) and a positive correlation between DTL and EPS (r = 0.121, p = 0.0379). These results underscore the critical role of strategic tax planning in balancing current tax obligations and deferred tax benefits to optimize wealth maximization. The study recommends that firms adopt efficient tax strategies and that policymakers implement tax reforms to foster corporate growth and economic development.
Keywords: Corporate tax, Wealth maximization, Tax compliance
