Abstract

The study was carried-out to analyse the effect of high corporate tax rate on the liquidity of corporate organizations in Nigeria. The related literatures were reviewed. The population of study comprises the selected corporate organizations while the sample size of the study is fourty one (41). Taro Yamane sampling technique was adopted because it ensures a satisfactory degree of representativeness and unbiasness. A number of statistical tools including tables and analysis of variance (ANOVA) were used to analysed the data and test the hypothesis formulated. The study revealed that, the burden of high corporate tax falls on the corporate organisations as it affects their liquidity, but the incidence of high corporate tax rate falls on the customers and suppliers through forward and backward shifting of prices- all things being equal. It is therefore, recommended that, the Nigeria corporate tax rate of 30% should be reduce below OECD average corporate tax rate of 25.32% to avert the negative economic effects of high corporate tax rate on the long-run and also the government should strengthen the Bank of Industry to close the funding gap in the corporate organisations.