Employee views of corporate tax aggressiveness in China: The effects of guanxi and audit independence
This study examines the effects of guanxi and audit independence on the corporate tax aggressiveness of Chinese firms. Based on a survey completed by 174 respondents in 2013, we find that two types of guanxi: favour-seeking guanxi and rent-seeking guanxi are significantly associated with ethical jud...
| Main Authors: | , , |
|---|---|
| Format: | Journal Article |
| Published: |
University of NSW
2015
|
| Online Access: | https://www.business.unsw.edu.au/research-site/publications-site/ejournaloftaxresearch-site/Documents/eJTR_Vol13_No3_2015.pdf http://hdl.handle.net/20.500.11937/44853 |
| Summary: | This study examines the effects of guanxi and audit independence on the corporate tax aggressiveness of Chinese firms. Based on a survey completed by 174 respondents in 2013, we find that two types of guanxi: favour-seeking guanxi and rent-seeking guanxi are significantly associated with ethical judgments of corporate tax aggressiveness. Perceptions of audit independence in-fact are significantly negatively associated with these ethical judgments, whereas audit independence in-appearance is positively associated with them. Further, significantly positive associations exist between perceptions that tax-aggressive activities are good for the firm and its shareholders and favour-seeking guanxi and between these perceptions and stronger client-auditor relations. This study provides insights into the association between types of guanxi and the propensity of firm management to engage in corporate tax aggressiveness. |
|---|