This study examines the associations between the provision of tax services by incumbent auditors and earnings management. We investigate whether three different effects of tax service provision play different roles in accounting practices. The three effects include the audit independence effect, the knowledge spillover effect, and the tax avoidance effect. If the provision of tax services by incumbent auditors harms auditor independence, firms may exercise greater earnings management (audit independence effect). However, if incumbent auditors gain incremental knowledge by offering tax services, the quality of their audit services could be enhanced, and therefore, reported earnings could be more conservative (knowledge spillover effect). If tax service fee leads to low taxable income, it could depress book income when book-tax conformity is high (tax avoidance effect). We find that the provision of tax services generally improves earnings quality by curtailing opportunistic accounting practices. The results also suggest that the negative association between the provision of tax services and discretionary accruals seems to be primarily driven by the knowledge spillover effect as opposed to the tax avoidance effect. Additional analysis is conducted in examining whether the tax avoidance effect exists in a sub-sample.

The purpose of this study is to investigate the effect of religiosity and religion on tax equity. Most prior studies have argued that higher taxpayers’ religiosity reduces tax evasion and increases the level of tax morale. Various studies have also shown that tax evasion and morale vary with perceptions of tax equity, including exchange, horizontal, and vertical equities. However, the relationship between religiosity and tax equity has not been studied actively. Especially in Korea, there has been considerable debate about the implementation of taxation for clergies. Therefore, the relationship between religiosity and tax equity will be analyzed clearly using Korean survey panel data. The results of this study show that religiosity and religion do not affect exchange and horizontal equity; however, each religion affects vertical equity. This implies that economic and social incentives are more effective than religiosity and religion on taxpayers’ tax evasion or morale.

No abstract

No abstract

This study critically analyzes problems of the current real estate holding taxes in terms of specific methods for tax burden calculation, and suggests remedies to them. The findings show that, regarding calculation method, household members' ratios of shares in shared housing should be applied consistently to separate taxes, and that excessive or incomplete deduction should be adjusted in dealing with the double taxation problem, and that consistent tax payment measures should be adopted in prescribing the tax burden ceiling. These problems will have to be remedied by making rational amendments to the relevant laws and regulations.