Why do firms evade taxes? The role of information sharing and financial sector outreach
Beck,T.H.L. Lin,C. Ma,Y.
Beck,T.H.L.
Lin,C.
Ma,Y.
Abstract
Tax evasion is a widespread phenomenon across the globe and even an important factor in the ongoing sovereign debt crisis. We show that firms in countries with better credit information–sharing systems and higher branch penetration evade taxes to a lesser degree. This effect is stronger for smaller firms, firms in smaller cities and towns, firms in industries relying more on external financing, and firms in industries and countries with greater growth potential. This effect is robust to instrumental variable analysis, controlling for firm fixed effects in a smaller panel data set of countries, and many other robustness tests.
Description
Date
2014
Journal Title
Journal ISSN
Volume Title
Publisher
Research Projects
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Keywords
SDG 9 - Industry, Innovation, and Infrastructure, SDG 17 - Partnerships for the Goals
Citation
Beck, T H L, Lin, C & Ma, Y 2014, 'Why do firms evade taxes? The role of information sharing and financial sector outreach', Journal of Finance, vol. 69, no. 2, pp. 763-817. https://doi.org/10.1111/jofi.12123