Extent of corporate tax evasion when taxable earnings and accounting earnings coincide

Abstract

Access to this document was granted through an Emerald subscription provided by 353605 [] For AuthorsIf you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The purpose of this paper is to examine the extent of corporate tax evasion and its implications on the protection of the shareholders and on the function of the capital market. Design/methodology/approach -The extent of tax evasion of the Greek public companies is estimated on the basis of tax audit data. Unvariate tests are employed in order to assess the effect of the audit firm and to examine corporate tax behaviour. Findings -The mean rate of tax evasion was estimated at about 16 per cent, showing that the incentive for tax evasion doesn't diminish when the companies are listed in the stock exchange. Specifically, the companies alter their tax behaviour (i.e. appear more tax compliant) only in the year of the IPO and the year before. It was also found out that the type of the audit firm is likely to affect the extent of tax evasion committed. Practical implications -The present paper provides evidence that corporate tax evasion is widespread and calls for appropriate measures. Nowadays, this issue has become more crucial than ever, as Greece is in the middle of the financial crisis. Moreover, the findings regarding audit effectiveness in detecting tax evasion have significant implications, as the 2010 Greek tax bill grants the audit firms the right to issue certificates for tax purposes. Originality/value -This paper contributes to the literature of fraudulent financial reporting by focusing on one specific form of fraud, which has been widely neglected -tax evasion.

Quo Vadis Kepatuhan Pajak?

“…Kondisi tersebut juga menjelaskan ka tegori lainnya yang mempertanyakan lemahnya daya tukar pemerintah yang diberi kan kepada wajib pajak sebagai kompensasi atas pembayaran pajak mereka. Beberapa peneliti mengatakan bahwa bagi wajib pajak, pajak tidak terelakkan dalam hidup mere ka (Busler, 2013;Christensen, 2011;Dinis, Martins, & Lopes, 2017;Kourdoumpalou & Karagiorgos, 2012;Martins, 2015). Meski pun demikian, banyak dari mereka yang tidak mau membayar pajak.…”

Real Earnings Management And Firm Value: Examination Of Costs Of Real Earnings Management

“…Although tax planning can be an object of audit, for example, an object for tax auditors, as long as the firm does the tax planning by engaging in tax avoidance without violating any tax regulation then it will be the good news for shareholders and increase firm value. Different from tax avoidance, firms that engage in tax evasion by violating regulations tend to engage in more aggressive strategies than REM such as accounting fraud and crime (Kourdoumpalou & Karagiorgos, 2012).…”

Corporate tax compliance during macroeconomic fluctuations

“…Using data on the outcomes of tax audits to Greek listed firms for the period 1992-2006, Kourdoumpalou and Karagiorgos (2012) estimated the mean rate of tax evasion at about 16%, a rather high percentage for a country where, at least until IFRS introduction in 2005, book and tax accounting were strongly aligned.…”