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Mixed ownership reform and corporate tax avoidance: Evidence of Chinese listed firms

Wei Wang, Hua Wang and Ji Wu ()

Pacific-Basin Finance Journal, 2021, vol. 69, issue C

Abstract: We find a significant negative relationship between a firm's mixed-ownership reform intensity ratio and the degree of corporate tax avoidance in China between 2003 and 2018. The path analyses demonstrate our finding is through the channel of a firm's financial constraints and analysts' earnings forecast dispersion. Furthermore, our main results are more pronounced for firms with a high level of media coverage and located in a region of weak tax enforcement or high willingness of government decentralisation. Finally, our results remain significant after alleviating a series of endogenous tests and robustness tests. We contribute to the literature to understand the causes of a firm's tax avoidance behaviour and the consequence of the mixed-ownership reform in China.

Keywords: Mixed-ownership reform intensity; Corporate tax avoidance; State-owned enterprises; China (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:69:y:2021:i:c:s0927538x21001554

DOI: 10.1016/j.pacfin.2021.101648

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Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee

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