Will a departure from tax-based accounting encourage tax noncompliance? Archival evidence from a transition economy

• 成果类型: Article
• 署名作者: Chan, K. Hung; Lin, Kenny Z.; Mo, Phyllis L. L.
• 署名单位: Lingnan University
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2010.02.001
• 发表日期: 2010
• 关键词: taxable income; earnings management; book income; FIRMS; avoidance

摘要

We investigate whether a departure from a tax-based accounting system toward the adoption of International Financial Reporting Standards encourages tax noncompliance. We also examine whether such a departure, which weakens book-tax conformity, affects the informativeness of book-tax differences for tax noncompliance. Our evidence suggests that as book-tax conformity decreases, tax noncompliance increases. Although book-tax differences remain informative of tax noncompliance, the informativeness attenuates as book-tax conformity weakens. Additionally, firms with high incentives to inflate book income are more tax compliant than their counterparts after the departure from a tax-based accounting system. (C) 2010 Elsevier B.V. All rights reserved.