Aggressive Tax Planning and Corporate Tax Avoidance: The Case Study

Externalities of Corporate Tax Avoidance

We show that when a meaningful proportion of firms in an economy engage in tax avoidance strategies, the covariance between a firm’s cash flow and the market cash flows increases, thereby increasing a firm’s cost of capital. This negative externality is imposed on all firms in the economy, not just tax-avoiding firms. The negative externality results regardless of the level of uncertainty assoc...

The Ranking of Effective Factors on Corporate Tax Avoidance

The Hierarchy of Effective Factors on Corporate Tax Avoidance Because of the information asymmetry within taxpayers and governments, commonly, the taxpayers try avoid the payment of tax. The problem can be explained by Agency theory. On the other hand, governmants try to maximize receiving tax by recognizing risky taxpayers and researchers try to recognize effective factors on tax avoidance. Th...

Tax Avoidance , Corporate Transparency , and Firm Value

Tax evasion , tax avoidance and development finance

Domestic revenue mobilisation is key to sustainable development finance – only self-sufficiency will allow the development of fully-functioning states with flourishing systems of political representation and economies reflecting societies’ expressed preferences in regard to, for example, inequality. Tax evasion and tax avoidance are important insofar as they affect both the volume and nature of...

Corporate Tax Evasion: the Case for Specialists

Economists agree that accounting specialists are helpful in avoiding taxes. We argue that such help can often be called sophisticated evasion. We analyze it in a game of incomplete information played by tax authority, corporate taxpayers and accounting specialist. When sophisticated evasion is very common, marginal changes in enforcement are not e¤ective, so radical measures are needed for impr...