An Empirical Evaluation of Tax Aggressiveness on Operating Cash Flows of Sampled Nigerian Banks

Abstract

This paper critically evaluated the extent to which tax aggressiveness affect operating cash flows (OCF) of 12 sampled Nigerian banks from 2012- 2021. The regressor is tax aggressiveness measured by accounting ETR, cash ETR, and income tax expense-ITE while the regressand is OCF measured by volumes of OCF. The study sourced data from the financial reports of the 12 sampled Nigerian banks. Specifically, descriptive statistics that were employed include mean, median, standard deviation, minimum and maximum value, skewness, kurtosis, and Correlation, diagnosis tests (variance inflation factor), and inferential statistics (panel least square estimate). The study evidenced that, a negative and negligible association among the tax aggressiveness proxies individually and OCF amongst the sampled banks within the reviewed periods. On the overall, tax aggressive has no discernible implicit effect on OCF of the 12 sampled Nigerian banks within the reviewed periods. Hence, the paper concludes that, the paper concludes that, the paper concludes high OCF is caused by tax aggressiveness. As such, the paper submits that, the sampled banks are advised to re-evaluate their asset base.
 Keywords: Tax Aggressiveness, Effective Tax Rate, Cash Effective Tax Rate, Income Tax Expense, Operating Cash Flows, Sampled Nigerian Banks.