EFFECT OF COMPANY INCOME TAX (CIT) ON PROFIT AFTER TAX (PAT) OF LISTED MANUFACTURING FIRMS IN NIGERIA
This study examined the effect of Company Income Tax on Profit After Tax of listed manufacturing firms in Nigeria over the period 2014 to 2025. The study was motivated by the increasing concern regarding the influence of taxation on corporate profitability and the sustainability of manufacturing firms within the Nigerian economy. Specifically, the study investigated the effect of Company Income Tax on Profit After Tax of listed manufacturing firms in Nigeria. The study adopted an ex post facto research design using panel data obtained from ten manufacturing firms listed on the Nigerian Exchange Group. Data covering a twelve year period were analyzed using descriptive statistics, diagnostic tests, Fixed Effects and Random Effects panel regression techniques. Financial performance was measured using Profit After Tax, while corporate taxation was proxied by Profit After Tax. Firm size, leverage, liquidity, and firm age were included as control variables. The Hausman specification test was employed to determine the most appropriate estimation technique. The findings revealed that Company Income Tax has a positive and statistically significant effect on Profit After Tax of listed manufacturing firms in Nigeria. The diagnostic tests confirmed the absence of multicollinearity and serial correlation, while the Hausman test supported the adoption of the Random Effects model. The study concluded that Company Income Tax is the most significant corporate tax variable influencing the financial performance of listed manufacturing firms in Nigeria. The study recommended that government should formulate stable and business friendly tax policies that encourage industrial growth while ensuring efficient revenue generation. The study also recommended that corporate managers should adopt effective tax planning and financial management strategies to enhance profitability and sustainability.
