Corporate Tax and Dividend Policy of Listed Conglomerate Companies in Nigeria

This study investigates the effect of corporate income tax on dividend policy of listed conglomerate companies in Nigeria. Sample data were obtained from the Nigerian Stock Exchange (NSC) for a period of ten years from 2007 to 2016. Panel regression analysis was adopted to estimate the effect of corporate income tax on dividend policy. The result revealed a significant relationship between the two constructs. Effective income tax rate and firm size have negative and significant effect on dividend yield. Leverage have insignificant positive effect on dividend yield of listed conglomerate companies in Nigeria. Its therefore recommended that, sufficient clarification of some sections of tax laws specially section 19 needs to be made by tax authority and the national assembly, so that profits which have already been taxed and those that are specifically exempted from tax dont have to be taxed twice as this may amount to double tax and have a negative consequences on the companys decision to pay dividend.