Effect of Companies Income Tax on Profitability of Deposit Money Banks (DMB’s): A Study of DMB’s with International Operating License in Nigeria

Abstract

Banks in Nigeria have operating strata ranging from regional to international-the study examine the how Companies Income Tax (CIT) affects Corporate profitability of Deposit Money Banks (DMB’s) as obtained from their annual report for 2017 using their Return on Assets (RoA) as Profitability parameter. OLS method was used via SPSS 20.0 to run the data used in the research with findings that; there exist a strong positive relationship between CIT and Corporate Profitability of Deposit Money Banks (DMB’s) in Nigeria and recommends a reduction in CIT rate with attendant increase in Education Tax (EDT) since buoyancy of the education sector (ceteris paribus) is expected to transcend in enhancement of Marginal Productivity of Labour which have positive spill over effect on Corporate Profitability in the longrun.

Keywords: Companies Income Tax (CIT), Corporate Profitability, Deposit Money Banks (DMB’s)

DOI: 10.7176/DCS/9-4-12

Publication date: April 30^th 2019