Does government support promote SME tax payments? New evidence from Vietnam

Vu Van Huong and Ly Kim Cuong

Finance Research Letters, 2019, vol. 31, issue C

Abstract: This paper examines whether governments can benefit from their support for firms by increasing firms’ tax compliance. With a panel dataset built from four small and medium-sized enterprise surveys conducted in Vietnam (from 2009 to 2015), we use fixed-effect instrumental variable estimations to empirically test the effect of government support on tax payment. We find that government financial support has a positive effect on total tax payments. Our results reflect the positive effect of government support on firm profitability and innovative activities. This study helps tax authorities to develop more effective strategies for increasing taxpayer compliance.

Keywords: Government support; Small- and medium-sized enterprise; Tax payment (search for similar items in EconPapers)
JEL-codes: E61 G32 H25 H26 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:31:y:2019:i:c:s1544612318306159

DOI: 10.1016/j.frl.2018.11.017

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