Increased Tax Disclosures and Corporate Tax Avoidance

Henry, Erin; Massel, Norman; Towery, Erin

doi:10.17310/ntj.2016.4.04

Cited by 36 publications

(31 citation statements)

References 15 publications

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“…The implementation of Schedule UTP requires consistency by a firm in the reporting of UTPs across financial statements and tax filings lodged with the IRS. Research by Henry, Massel, & Towery () finds that Schedule UTP disclosure requirements are associated with higher levels of corporate tax avoidance. These results are consistent with the idea that a firm's UTP reporting requirements may provide information about its tax avoidance activities.…”

Section: Resultsmentioning

confidence: 99%

“…As additional analysis, we also consider the impact of UTP reporting requirements on the association between income-shifting arrange- Henry, Massel, & Towery (2016) finds that Schedule UTP disclosure requirements are associated with higher levels of corporate tax avoidance. These results are consistent with the idea that a firm's UTP reporting requirements may provide information about its tax avoidance activities.…”

Section: Additional Analysis: the Impact Of Uncertain Tax Position mentioning

confidence: 99%

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Uncertain tax benefits, international tax risk, and audit specialization: Evidence from US multinational firms

2018

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The purpose of this study is twofold. First, it examines the association between income‐shifting arrangements consisting of transfer pricing aggressiveness, tax haven use and foreign tax rate differentials, and Financial Interpretation No. 48 (FIN48, now ASC740–10‐25) unrecognized tax benefits (UTBs). Second, it analyzes the impact of audit specialization on the association between income‐shifting arrangements and UTBs. Using a dataset of 286 US multinational firms over the 2007–2016 period (2,097 firm‐years), our regression results show that income‐shifting arrangements represented by transfer pricing aggressiveness, tax haven use and foreign tax rate differentials are significantly positively associated with UTBs. We also observe that audit specialization magnifies the positive association between transfer pricing aggressiveness and UTBs, and foreign tax rate differentials and UTBs. Finally, in additional analysis we provide some evidence that the positive association between income‐shifting arrangements and UTBs is magnified in the post‐2010 uncertain tax position reporting requirement period. Overall, our study extends prior research on the topic of audit characteristics (i.e., audit specialization) and tax aggressiveness.

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Section: Resultsmentioning

confidence: 99%

Section: Additional Analysis: the Impact Of Uncertain Tax Position mentioning

confidence: 99%

Uncertain tax benefits, international tax risk, and audit specialization: Evidence from US multinational firms

2018

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“…In response to this threat, firms' tax disclosure strategies are varied; in some cases even, no response is provided. Henry et al (2016) recently observed that disclosure requirements providing relevant information about tax avoidance activities are associated with lower levels of tax avoidance. Taking the relationship the other way round, Gleason and Mills (2002) provide evidence that managers of companies using tax planning are unwilling to disclose information about these activities.…”

Section: Related Literaturementioning

confidence: 99%

Coercive, normative, and mimetic isomorphisms as drivers of corporate tax disclosure

Depoers

Jérôme

2019

JAAR

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Purpose International Accounting Standard (IAS) 12 requires the disclosure of a tax reconciliation (TR). The purpose of the TR is to explain the differences between the corporate effective tax expense and the corporate theoretical tax expense. In this paper, the authors investigate which institutional pressures influence the level of disclosure of the TR. Design/methodology/approach The study draws on an empirical archival approach in which the level of disclosure is first measured and then associated with institutional pressures. The sample comprises 120 companies listed on the Paris stock exchange, i.e. a highly institutionalized setting. Findings The findings show a wide variation in the level of disclosure of the TR across the sample and that all three types of isomorphism (coercive, normative and mimetic) are associated with disclosure. Research limitations/implications The paper deals exclusively with TR given its importance to a wide range of users. Additional tax information available in annual reports, most of the time at an expert level, may be the subject of further research. Practical implications The results have important implications for standard setters, regulators, and practitioners as the research outlines the institutional pressures at work in corporate reporting policies and pushes forward the debate on fiscal transparency. Originality/value This paper documents the influence of institutional pressures on the level of the TR disclosure at a country level. It contributes to the literature on corporate tax disclosure which mainly focuses on differences across countries. An innovative ad hoc index is used to measure information completeness.

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“…Aqui, identificam-se tanto investigações teóricas (De Simone, Sansing & Seidman, 2013) como empíricas (Bozanic, Hoopes, Thornock & Williams, 2017). As pesquisas centram-se, predominantemente, no papel das autoridades fiscais na inibição da Agressividade Tributária (Hoopes, Mescall & Pittman, 2012), a distância à autoridade fiscal da sede física do sujeito passivo (Kubick, Lockhart, Mills & Robinson, 2017), a atuação dos reguladores financeiros, tais como o monitoramento da SEC, (Hope, Ma & Thomas, 2013; e o papel da transparência fiscal (Beck & Lisowsky, 2014;Henry, Massel & Towery, 2016).…”

Section: Restrições Dos Gatekeepersunclassified

Agressividade Tributária: Um Survey da Literatura

Martinez

2017

REPeC

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Objetivo e Método: o objetivo deste artigo é revisar os estudos internacionais e no Brasil sobre a agressividade tributária, esta entendida como o comportamento de tentar evitar ou minimizar o ônus tributário explícito para a corporação. Enquanto tema de pesquisa acadêmica, o tax aggressiveness ou tax avoidance revela-se em um tópico diversificado e vasto, embora relativamente recente. Resultados e Contribuições: Entre as perguntas de pesquisa que nessa temática se desenvolvem, destaquem-se a identificação de quais seriam os determinantes da agressividade tributária da firma, apreciando: (i) características das firmas; (ii) atributos ambientais; (iii) restrições de gatekeepers; e (iv) incentivos para as firmas. Revisam-se os determinantes da agressividade tributária dos gestores e a influência da governança e estrutura de controle. Adicionalmente, identificam-se as potenciais consequências econômico-financeiras da agressividade tributária para as firmas e as proxies empíricas existentes para mensurar a agressividade tributária. O estudo se encerra com a apresentação de oportunidades futuras de pesquisa na temática.

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Increased Tax Disclosures and Corporate Tax Avoidance

Cited by 36 publications

References 15 publications

Uncertain tax benefits, international tax risk, and audit specialization: Evidence from US multinational firms

Uncertain tax benefits, international tax risk, and audit specialization: Evidence from US multinational firms

Coercive, normative, and mimetic isomorphisms as drivers of corporate tax disclosure

Agressividade Tributária: Um Survey da Literatura

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