The Effects of Markup and  Corporate  Governance on Tax-Avoidance of  Listed Companies in the Tehran  Stock Exchange

Noraniazad, Samaneh; Moghali, Alireza; Zarei, Nahid

doi:10.30473/jier.2022.8747

Document Type : applicative

Authors

¹ Assistant Professor of Economics, Payame Noor University, Tehran, Iran

² professor of management, Payame Noor University, Tehran, Iran

³ MS budget Management , Payame Noor University, Tehran, Iran

https://doi.org/10.30473/jier.2022.8747

Abstract

The main purpose of this article is to evaluate the effect of markup and corporate governance on tax avoidance of the listed companies in the Tehran stock exchange. For this purpose, data from 100 active manufacturing firms over the periods of 2011-2019 were used. The results indicate that the managers of the firms which have market power are not worried about reducing profits because of being in a safe hedge and the immunities against their rivals.
Also, the managers for having the payment rewards and shareholders’ incentive schemes, try to maximize the wealth and worth of the firm and increase tax avoidance drastically. Moreover, the results of the corporate governance indicate that institutional investors, due to the high financial benefits of investing and achieving market power, will have a higher motivation to monitor the managers’ activity to reduce agency costs and increase tax avoidance. Overall, managers and shareholders try to increase tax avoidance by reducing benefits conflicts.

Keywords

20.1001.1.24767077.1400.5.18.3.2

References

پورقربان، محمدرضا (1400). "کاربرد مدل هال – راجرز در سنجش حاشیه سود صنعت تولید فلزات پایه". فصلنامه پژوهش‌های اقتصاد صنعتی، 5 (16)، 34-25.

حمیدیان، محسن (1396)."بررسی ابعاد مختلف راهبری شرکتی با اجتناب مالیاتی شرکت‌های پذیرفته شده در بورس اوراق بهادار تهران". فصلنامه دانش سرمایه‌گذاری، 6 (23)، 229-243.

خدامی‌پور، احمد، بزرایی، یونس (1394). "تاثیر رقابت در بازار محصول بر اجتناب از پرداخت مالیات شرکت‌های پذیرفته شده در بورس اوراق بهادار تهران". پژوهشنامه مالیات، 75 (27)، 211-227.

خیرخواه، رزیتا؛ اسعدی، عبدالرضا، زنده‌دل، احمد (1398). "ارتباط تمرکز و قدرت بازاری محصول با سیاست تقسیم سود شرکت‌های پذیرفته شده در بورس اوراق بهادار تهران". فصلنامه پژوهشنامه بازگانی، 92، 113-139.

فرجی، امید؛ سجادپور، رضا، رفیعی، مرتضی، برجی، پریسا (1399). "قابلیت مقایسه صورت‌های مالی، رقابت بازار محصول و اجتناب مالیاتی". پژوهشهای حسابداری مالی، 3 (45)، 23-43.

مدرس، احمد؛ حسینی، سیدمجتبی، رییسی، زهره (1388). "بررسی اثر سهامداران نهادی به عنوان یکی از معیارهای حاکمیت شرکتی بر بازده سهامداران شرکتهای پذیرفته شده در بورس اوراق بهادار تهران". پژوهشنامه اقتصادی، 5، 223-250.

مردانی، مهدی؛ صفری گرایلی، مهدی، ولیان، حسن (1396). "تمرکز مشتری و اجتناب مالیاتی: شواهدی از بورس اوراق بهادار تهران". فصلنامه دانش حسابرسی، 18 (73)، 123-137.

میکاییلی، سیده‌وجیهه؛ نورانی‌آزاد، سمانه، کریم، محمدحسین (1399). "اندازه‌گیری مارک‌آپ و قدرت بازاری در بخش صنعت ایران: رویکرد مرز تصادفی". فصلنامه پژوهش‌های اقتصاد صنعتی، 4 (13)، 46-27.

Abdelfattah, T., & Aboud, A. (2020). “Tax avoidance, corporate governance, and corporate social responsibility: The case of the Egyptian capital market”. Journal of International Accounting, Auditing and Taxation, 38, 1-16.

Armstrong, C. S., Blouin, J. L., Jagolinzer, A. D., & Larcker, D. F. (2015). “Corporate governance, incentives, and tax avoidance”. Journal of Accounting and Economics, 60(1), 1-17.

Bayar, O., Huseynov, F., & Sardarli, S. (2018). “Corporate governance, Tax avoidance, and financial constraints”. Financial Management, 47(3), 651-677.

Cai, H., & Liu, Q. (2009). “Competition and corporate tax avoidance: Evidence from Chinese industrial firms”. The Economic Journal, 119(537), 764-795.

Chen, C., Li, L., & Ma, M. L. (2014). “Product market competition and the cost of equity capital: evidence from China”. Asia-Pacific Journal of Accounting & Economics, 21(3), 227-261.

Chytis, E., Tasios, S., Georgopoulos, I., & Hortis, Z. (2019). “The relationship between tax avoidance, company characteristics and corporate governance: Evidence from Greece”. Corporate Ownership and Control, 16(4), 77-86.

Desai, M. A., & Dharmapala, D. (2006). “Corporate tax avoidance and high-powered incentives”. Journal of financial Economics, 79(1), 145-179.

Dyreng, S. D., Jacob, M., Jiang, X., & Müller, M. A. (2017). “Tax avoidance and tax incidence”. Unpublished Working Paper. Available at SSRN: https://ssrn.com/abstract=3070239

Hou, K., & Robinson, D. T. (2006). “Industry concentration and average stock returns”. The Journal of Finance, 61(4), 1927-1956.

Jiang, Y., Zheng, H., & Wang, R. (2021). The effect of institutional ownership on listed companies’ tax avoidance strategies. Applied Economics, 53(8), 880-896.

Kerr, J. N., Price, R. A., Román, F. J., & Romney, M. A. (2021). “Corporate governance and tax avoidance: Evidence from governance reform”. Available at SSRN 3861965.

Kim, J. B., Li, Y., & Zhang, L. (2011). “Corporate tax avoidance and stock price crash risk: Firm-level analysis”. Journal of financial Economics, 100(3), 639-662.

Kovermann, J., & Velte, P. (2019). “The impact of corporate governance on corporate tax avoidance—A literature review”. Journal of International Accounting, Auditing and Taxation, 36, 100270.

Kubick, T. R., Lynch, D. P., Mayberry, M. A., & Omer, T. C. (2015). “Product market power and tax avoidance: Market leaders, mimicking strategies, and stock returns”. The Accounting Review, 90(2), 675-702.

Martin, J., Parenti, M., & Toubal, F. (2020). “Corporate tax avoidance and industry concentration”. Available at SSRN: https://ssrn.com/abstract=3661403

McGuire, S. T., Omer, T. C., & Wilde, J. H. (2014). “Investment opportunity sets, operating uncertainty, and capital market pressure: Determinants of investments in tax shelter activities?”. The Journal of the American Taxation Association, 36(1), 1-26.

Mills, L. (2017). “Barriers to improving tax capacity”. K4D Helpdesk Report; Institute of Development Studies: Brighton, UK.

PENG, X.-r., & XU, H.-r. (2016). “The Influence of Product Market Power on the Company's Tax Avoidance”. Journal of Shanxi University of Finance and Economics.

Peress, J. (2010). “Product market competition, insider trading, and stock market efficiency”. The Journal of Finance, 65(1), 1-43.

Pesaran, M. H. (2012). “On the interpretation of panel unit root tests”. Economics Letters, 116(3), 545-546.

Richardson, G., Wang, B., & Zhang, X. (2016). Ownership structure and corporate tax avoidance: Evidence from publicly listed private firms in China. Journal of Contemporary Accounting & Economics, 12(2), 141-158.

Sharma, V. (2011). “Stock returns and product market competition: Beyond industry concentration”. Review of Quantitative Finance and Accounting, 37(3), 283-299.

Shin, I., & Park, S. (2019). “The relation between product market competition and corporate tax avoidance: evidence from Korea”. Investment Management and Financial Innovations, 16(2), 313-325.

Shleifer, A., & Vishny, R. W. (1986). Large shareholders and corporate control. Journal of political economy, 94(3, Part 1), 461-488.

Widyastuti, T. (2018). “The effect of corporate governance mechanism on tax avoidance: Evidence from manufacturing industries listed in the Indonesian stock exchange”. The International Journal of Social Sciences and Humanities Invention, 5(10), 5003-5007.

Yee, C. S., Sapiei, N. S., & Abdullah, M. (2018). “Tax avoidance, corporate governance and firm value in the digital era”. Journal of Accounting and Investment, 19(2), 160-175.

Journal of Industrial Economics researches

The Effects of Markup and Corporate Governance on Tax-Avoidance of Listed Companies in the Tehran Stock Exchange

References

References

Volume 5, Issue 18
January 2022
Pages 45-58

The Effects of Markup and Corporate Governance on Tax-Avoidance of Listed Companies in the Tehran Stock Exchange

References

References

Volume 5, Issue 18January 2022Pages 45-58

Volume 5, Issue 18
January 2022
Pages 45-58