Impact of Taxation on Profitability of Banks in Jordan


  • Hunar Jabar Mohammed, Ali Omer Mohammed, Peshkawt Abdullah Abdulkarim


The study examines the impact of taxation on corporate income in Jordan and the significance of this study is attached to the idea that the advancement of each country depends to a great extent on the amount of income tax harnessed to begin and execute improvement ventures. Most progressive economies with sorted out and very much organized investment-related establishments and approaches have had key advancements because of their capacity to levy income tax and utilize it for reasonable improvement ventures. In this way, there is an awesome need to enhance further comprehension of the effect of corporate assessment on bank profitability. A multiple regression estimation procedure was adopted using secondary data that spans from 1999-2014. The results of the study showed thatbank size and deposits are significant determinants of bank profitability. The impact of tax on bank size and deposits is thus significant. The relationship between capital adequacy and liquidity was observed to be negative and insignificant.

Keywords: Taxation, Corporate tax, bank profitability, capital adequacy, Jordanian banks.