Determinants of tax avoidance and the real effects of tax risk disclosures
Abstract/Contents
- Abstract
- I model the determinants of corporate tax avoidance to estimate the real effect of tax risk disclosures. Prior research hypothesizes that firms forgo profitable tax-saving strategies due to non-tax costs, financial reporting incentives, and tax authority scrutiny. Because many of these frictions are not directly observable, I quantify their effects using a dynamic structural model in which the firm chooses a set of tax-saving projects in each period to maximize the discounted stream of future net income. Structural modeling also permits me to quantify the real effect of tax risk disclosures. I estimate the disclosure decreases tax avoidance by 7.6\% but overstates the expected repayment after including audit and inspections by 6.0 times. When I adjust the disclosure to reflect the expected repayment, I find tax avoidance increases by 5.7\%. Finally, I find that average non-tax costs decrease pre-tax earnings by 14.6\% but that the cross-sectional dispersion in effective tax rates primarily arises from differences in the ability to avoid taxes rather than differences in non-tax costs.
Description
| Type of resource | text |
|---|---|
| Form | electronic resource; remote; computer; online resource |
| Extent | 1 online resource. |
| Place | California |
| Place | [Stanford, California] |
| Publisher | [Stanford University] |
| Copyright date | 2018; ©2018 |
| Publication date | 2018; 2018 |
| Issuance | monographic |
| Language | English |
Creators/Contributors
| Author | McClure, Charles Gavan |
|---|---|
| Degree supervisor | Larcker, David F |
| Thesis advisor | Larcker, David F |
| Thesis advisor | De Simone, Lisa |
| Thesis advisor | Hartmann, Wesley R. (Wesley Robert), 1973- |
| Thesis advisor | Reiss, Peter C. (Peter Clemens) |
| Degree committee member | De Simone, Lisa |
| Degree committee member | Hartmann, Wesley R. (Wesley Robert), 1973- |
| Degree committee member | Reiss, Peter C. (Peter Clemens) |
| Associated with | Stanford University, Graduate School of Business. |
Subjects
| Genre | Theses |
|---|---|
| Genre | Text |
Bibliographic information
| Statement of responsibility | Charles Gavan McClure. |
|---|---|
| Note | Submitted to the Graduate School of Business. |
| Thesis | Thesis Ph.D. Stanford University 2018. |
| Location | electronic resource |
Access conditions
- Copyright
- © 2018 by Charles Gavan McClure
- License
- This work is licensed under a Creative Commons Attribution Non Commercial 3.0 Unported license (CC BY-NC).
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