CORPORATE TAX PLANNING AND ASSET GROWTH IN OIL AND GAS IN NIGERIA

ABSTRACT The legitimate game, deliberate and strategic management of a firm's tax affairs to optimize and reduce it's tax liabilities while remaining compliant with the legal framework has serious adverse effect on the firms asset growth thus exerting a negative pressure on the financial capacity and earnings capacity of the firm. This study examined the effect of corporate tax planning on asset growth of listed oil and gas firms ni Nigeria from 2013 to 2022. The independent variable si proxied by effective tax rate (ETR), capital intensity (INT) and thin capitalization (CAP) while the dependent variable is proxied by asset growth (AG). The study was conducted using ex-post facto research design on 9 listed oil and gas firms in Nigeria. Pooled least square regression analysis was adopted to analyze the secondary data collected for the study with diagnostics tests such as normality test, multicolinearity test as well as test of heteroscedasticity. The results of the analysis revealed that effective tax rate has no significant effect on asset growth while capital intensity and thin capitalization has significant effect on asset growth of listed oil and gas firms. The study recommends that although firms need to calculate their effective tax rates, they also need to ensure that the proportion of noncurrent assets to total assets is high. In other words, they should have high capital intensity as this was found to positively increase asset growth. Oil and gas firms should also use more of debt than equity to finance investments or operations. By so doing, they could pay less tax thereby increasing profit and assets of the firm.