Reciprocity in Corporate Tax Compliance-Evidence from Ozone Pollution

• 成果类型: Article
• 署名作者: Chow, Travis; Fan, Zhongwen; Huang, Li; Li, Oliver Zhen; Li, Siman
• 署名单位: University of Hong Kong; City University of Hong Kong; Shanghai Jiao Tong University; Shanghai Lixin University of Accounting & Finance; National University of Singapore; Xiamen University
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/1475-679X.12500
• 发表日期: 2023
• 页码: 1425-1477
• 关键词: air-pollution; regulations; incentives; executives; ECONOMICS; Managers; culture; evasion; demand; matter

摘要

In a tax-public goods reciprocity framework between citizens and the state, managers view taxes as a payment to the government in exchange for public goods, and hence they adjust their willingness to pay taxes as public good quality changes. We show that corporate tax planning intensity increases with ground-level ozone pollution. Revisions in ozone pollution regulations cause counties that failed the revised and more stringent standards to reduce ozone pollution. Consequently, firms headquartered in these counties reduced corporate tax planning intensity relative to firms in other counties. The ozone-tax link varies in the predicted directions with public attention to pollution, potential welfare loss due to ozone, managers' stakeholder orientation, taxpayers' polluting status, political preferences, and civic norms. We also find consistent results for Superfund cleanups of hazardous waste sites. Our research sheds light on reciprocity as a potential mechanism influencing corporate tax compliance.