EFFECT OF TRANSFER PRICING REGULATIONS ON MULTINATIONAL CORPORATIONS' TAX BURDEN OF QUOTED INDUSTRIAL GOOD FIRMS IN NIGERIA.

This study evaluated the effect of transfer pricing regulations on the tax burden of quoted industrial good firms in Nigeria between 2014 and 2023. It employed a panel regression model to examine the relationships between related party transactions (RPT), effective tax rate (ETR), cash effective tax rate (CETR), and the tax-to-GDP ratio. Findings reveal that RPT significantly increased both ETR and CETR, indicating that stricter regulations have compelled firms to align intra-company transactions with arm’s length principles. However, RPT did not have a statistically significant effect on the tax-to-GDP ratio. Firm size had no significant impact on ETR and CETR but exhibited a marginally positive influence on the tax-to-GDP ratio. These results suggest that while transfer pricing regulations have improved tax compliance and burden distribution among multinational corporations, their broader macroeconomic impact remains inconclusive.