FIRM VALUE, FIRM RISK ON TAX AVOIDANCE

ABSTRACT

The study examines the relationship between firm value, firm risk, and tax avoidance, shedding light on the intricate interplay between these crucial elements within the corporate landscape. Tax avoidance has garnered increasing attention as a strategic financial maneuver for firms seeking to enhance their financial performance and competitiveness. This research endeavors to provide a comprehensive understanding of how firm value and firm risk are influenced by tax avoidance strategies, and conversely, how these elements impact tax avoidance decisions. . This study employed the ex-post facto research design and data collected were extracted from the audited annual report of forty nine financial companies listed in the Nigerian Exchange Group (NGX) covering the period from 2017 to 2022. Also the data collected in this study were analyzed using a robust least square regression technique. The findings reveal that firms value strongly influences tax avoidance of firms in Nigeria. The study also found out that~firm`risk has a considerable impact on Nigerian business tax avoidance.Based o n the findings of this study, the Nigerian government should conduct regular tax risk a ssessments, which include reviewing current practices, identifying potential areas of n oncompliance or aggressive tax planning, and assessing the effectiveness of existing c ontrols.In order to reverse the negative effects of tax avoidance on firm value, the gov ernment should provide opportunities to all through the prudent use of tax proceeds, t hereby encouraging high rates of tax compliance and reducing the twin problems of t ax evasion and avoidance to a tolerable level.