Study of Effective Corporate Tax Rate and Its Influential Factors: Empirical Evidence from Emerging European Markets

Vintilă, Georgeta; Gherghina, Ştefan Cristian; Păunescu, Radu Alin

doi:10.1080/1540496x.2017.1418317

Cited by 22 publications

(26 citation statements)

References 45 publications

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“…There are few studies that have used capital profitability as a determinant of the effective tax burden. Vintilă, Gherghina, & Păunescu (2018) use the same variable, and their results are not consistent with this study, as they also showed a positively significant impact of this variable on the effective tax burden.…”

Section: Regression Resultscontrasting

confidence: 79%

Determinants of the effective tax burden of companies in the Telecommunications activities in the Republic of Croatia

Bubanić

Šimović

2021

Zagreb International Review of Economics and Business

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The aim of this paper is to identify the determinants of the effective tax burden of companies in the activity division Telecommunication in the Republic of Croatia. The research covers the time interval from 2008 to 2017. Dynamic panel analysis was used to conduct the research. Microeconomic data were obtained from the databases of the Financial Agency, and macroeconomic data from the Central Bureau of Statistics. The results indicate that the effective tax burden of companies in the activity division Telecommunication is affected by the effective tax burden from the previous period, company size, leverage, inventory intensity, profitability and economic cycle. While capital and labour intensity didn`t prove statistically significant. The main limitations of the research lie in the impossibility of generalizing the stated results to all companies from the observed activity, using only one evaluation model, and being a cabinet-type research, without confirmation of the results obtained by companies. The research received several scientific contributions: this is the first study of the determinants of the effective tax burden conducted in the Republic of Croatia; the research covers an entire activity whit different companies sizes, and not as in most previous research, which mainly include only large companies listed on the stock exchange; unlike previous studies that used a balanced sample, and in most cases static panel models, this study used an unbalanced sample and a dynamic panel model.

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Section: Regression Resultscontrasting

confidence: 79%

Determinants of the effective tax burden of companies in the Telecommunications activities in the Republic of Croatia

Bubanić

Šimović

2021

Zagreb International Review of Economics and Business

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“…Previous studies have found that companies that have higher debts are negatively associated with tax planning due to the interest deductibility. Prior studies have shown mixed results where a positive (Parisi, 2016;and Wahab et al, 2017), negative (Nomura, 2017;and Yinka and Uchenna, 2018) and insignificant (Vintilă, Gherghina, and Păunescu, 2018) relationship between leverage and ETR has been found in these studies. The positive result was also reported by Halperin and Lai (2015) in examining the relationship between leverage and audit fees (audit services and tax services).…”

Section: The Influence Of Nas Fee On the Relationship Between Leverage And Aggressive Tax Planningmentioning

confidence: 76%

“…Again mixed finding has been reported where Hadjidema et al (2016) and Rashid, Noor, and Mastuki (2015) however found a negative relationship showing that higher capital intensity resulted in the lower ETR suggesting that company implement an aggressive tax planning. Delgado, Fernandez-Rodriguez, and Martinez-Arias (2014) and Vintilă et al (2018) found a positive relationship between capital intensity and ETR. This usually against the industry practise where companies increase the ownership in capital asset to utilize the benefit of incentives.…”

Section: The Influence Of Nas Fee On the Relationship Between Capital Intensity And Aggressive Tax Planningmentioning

confidence: 92%

“…A negative association was reported suggesting that higher investment in inventory leads to a reduction in the tax payment (for example, Hadjidema et al, 2016;Savitri, 2017). On the other hand, some studies have found a positive result (for example Hsieh, 2012;Noor, Fadzilah, & Mastuki, 2010;Vintilă et al, 2018) showing that company may pay the higher tax due to the turnover in inventory. To provide a new area of the discussion on the determinants of aggressive tax planning, this study continues the examination of the role of capital intensity on aggressive tax planning by introducing the moderating variable of NAS fee.…”

Section: The Influence Of Nas Fee On the Relationship Between Inventory Intensity And Aggressive Tax Planningmentioning

confidence: 99%

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The Moderating Effect of Non-audit Services Fee on Aggressive Tax Planning: Empirical Evidence From Malaysian Listed Companies

Jaffar¹,

Derashid²,

Taha³

2021

IJFR

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The purpose of this study is to examine the moderating effect of non-audit services fees on the relationship between size, profitability, leverage, capital intensity, inventory intensity, financial distress and ethnicity with aggressive tax planning. This study uses a sample from companies listed on the Malaysian (Access, Certainty, Efficiency (ACE) Market from 2014 to 2018, comprising of 105 firm year-observations. The finding shows that the non-audit services fee moderate the relationship between size, profitability, leverage, inventory intensity, financial distress and ethnicity with aggressive tax planning except for capital intensity. It is hoped that the finding can assist readers in understanding the nature of companies listed on the ACE Market, particularly their behaviour towards tax planning. This study contributes to knowledge in the areas of financial accounting and taxation specifically on aggressive tax planning, by introducing the moderating variable of non-audit services fee. The uniqueness of the use of companies listed on the Malaysian ACE market will provide new avenue on the discussion on an aggressive tax planning issue, which usually more focus on big firms. The framework used in the present study could serve as a basis for research in other developing countries or regions.

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“…In contrast, research on emerging European countries found that audit fees do not affect effective tax rate (ETR) (Vintil a et al, 2018). Similar research in a German setting also found that audit fees do not affect ETR (Kraft and Lopatta, 2016).…”

Section: Tax Aggressiveness and Audit Feesmentioning

confidence: 92%

The effect of audit fees, audit quality and board ownership on tax aggressiveness: evidence from Thailand

Marzuki

Syukur

2021

ARA

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PurposeThe purpose of this study is to investigate the effect of audit fees, auditors' quality and board ownership on tax aggressiveness in Thailand.Design/methodology/approachThe sample of this study is based on 215 firm-year observations of SET-100 listed companies in Thailand during the 2010–2018 periods. This study employs a panel least square regression with period fixed effects. The study retrieved the corporate governance variables from the downloaded annual reports, whilst the remaining data were collected from the EMIS database.FindingsThis study provides evidence that audit fees reduce tax aggressiveness and board ownership enhance tax aggressiveness among the firms. Nonaudit services provided by auditors impair auditors' independence and lead to higher tax aggressiveness. The result supports the agency theory, which explains that managers and blockholders may enjoy private benefits of control at the expense of other shareholders in the absence of market control. Thus, firms need good governance practices such as incentives paid for the effort of auditors and nonaudit services monitoring to curb such exploitation.Research limitations/implicationsThe results provide implications to the firms and regulators that incentives to the monitoring parties such as auditors can reduce tax aggressiveness among the firms. Nevertheless, higher ownership given to boards as incentives may lead to concentrated ownership and thus lead to the type 2 agency problem, which is between majority and minority shareholders. The result also provides caution to the regulators to monitor the nonaudit services provided by the auditors as it might impair their independence and compromise the tax paid to IRB.Originality/valueThis study is pioneer research discussing tax avoidance in Thailand. The Thai Government has been noticing that tax avoidance is being performed in the country, but academic discussion on this topic had never been elaborated.

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Study of Effective Corporate Tax Rate and Its Influential Factors: Empirical Evidence from Emerging European Markets

Cited by 22 publications

References 45 publications

Determinants of the effective tax burden of companies in the Telecommunications activities in the Republic of Croatia

Determinants of the effective tax burden of companies in the Telecommunications activities in the Republic of Croatia

The Moderating Effect of Non-audit Services Fee on Aggressive Tax Planning: Empirical Evidence From Malaysian Listed Companies

The effect of audit fees, audit quality and board ownership on tax aggressiveness: evidence from Thailand

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