Impact of Board Independence Efficiency in Corporate Tax Planning Among Commercial and Services Firms Listed at the Nairobi Securities Exchange, Kenya
DOI:
https://doi.org/10.53819/81018102t3183Abstract
Corporate tax essentially provides revenue for governments globally, as well as a tool for achieving a variety of fiscal goals. Corporation tax, on the other hand, is a considerable burden for businesses, influencing crucial business choices. Understanding the elements that influence corporate tax planning is crucial not only for businesses, but also for states as well as other regulators. The study assessed board of directors impact on corporate tax planning. The distinct goal included exploring the usefulness of board independence on corporate tax planning. The study was anchored on Tax planning, Stewardship Theory and Resource dependency Theory. The time scope was from 2015-2020. Secondary data was collected from NSE using data collection sheet. The study was examined using panel regression techniques. Various diagnostic test like stationarity, multicollinearity, heteroscedasticity and Hausman test were utilized. Standards with an ethical bent were adequately upheld. Evidence from the findings showed that board independence insignificantly affected commercial and services traded businesses tax planning at NSE negatively. The study recommends that board members should be allowed complete independence to assist them in the performance of their tax planning duties. As tax planning involves the services of experts, it is necessary for the best hands to be employed by the firms. This would allow for effective rate determination and avoid unnecessary conflict of interest within the stakeholders of these firms.
Keywords: Board Independence, Efficiency, Corporate Tax, Planning, Commercial and Services Firms Listed, Nairobi Securities Exchange
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