COMPANY INCOME TAX AND PERFORMANCE OF QUOTED DEPOSIT MONEY BANKS IN NIGERIA

This study investigated the impact of company income tax (CIT) on the financial performance of quoted deposit money banks in Nigeria. An ex-post facto research design was adopted, using a population consisting of all deposit money banks quoted on the Nigerian Stock Exchange. From this population, a sample of five (5) banks was selected, and secondary data covering a period of five years (2019-2024) were extracted from their published financial statements. The study employed both the Autoregressive Distributed Lag (ARDL) model and Panel Least Squares Regression analysis to examine the data. To test the long-run relationship and stationarity of the variables, the Augmented Dickney-Fuller (ADF) unit-root test was employed at a 5% level of significance. The empirical findings revealed the presence of a long-run equilibrium relationship between CIT on bank profitability (p-value= 0.000< 0.05). These results suggest that, CIT may positively influence profitability through mechanisms such as improved regulatory compliance, better financial disclosure, and enhanced investor confidence. The findings revealed that company income tax has a positive and statistically significant effect on financial performance, measured by ROA, while firm size also showed a significant positive relationship. The results confirm the existence of a long-run relationship between company income tax and financial performance. The study concludes that while company income tax contributes positively to the profitability of deposit money banks, firm size remains a stronger determinant of financial performance. It recommends that tax policies should be designed in a way that supports growth and sustainability in the banking sector.