CORPORATE TAX AVOIDANCE AND INVESTING CASH FLOWS PERFORMANCE: A STUDY OF QUOTED MANUFACTURING FIRMS IN NIGERIA

Abstract

This study ascertains the effect of corporate tax avoidance on investing cash flows performance of quoted manufacturing firms in the Nigerian Stock Exchange. Specifically, the study determine the effect of effective tax rate and book tax difference on investing cash flows of quoted manufacturing firms. Ex-Post Facto research design was adopted for the study. Data for the study were extracted from annual reports and accounts of the sampled firms. The formulated hypotheses were tested using regression analysis with Stata version 15. The analysis shows that there ‘is a statistically significant effect of effective tax rate on investing cash flows of quoted manufacturing firms, and also reported that book tax difference has a statistically significant effect on investing cash flows of quoted manufacturing firms. Based on the result, curtail earnings management acts by managers, shareholders need to ensure that tax savings are deployed for investment decisions in the firms, such as diversification objectives or new product developments, etc.