 THE EFFECT OF CEO POWER ON TAX AVOIDANCE: EVIDENCE FROM TAIWANRu-Je Lee and Hui-Sung Kao Global Journal of Business Research, 2020, vol. 14, issue 1, 1-27 Abstract: This paper explores the relationship between CEO power and firms’ tax avoidance. The study examines listed and OTC companies from Taiwan. Data from 2010 to 2016 on sampled firms were taken from the database of Taiwan Economic Journal. Research findings indicate that the higher the comprehensive power of CEOs, the more tax avoidance is mitigated in general. This finding is consistent with the stewardship theory that CEOs care about business reputation and corporate social responsibility. The paper divides CEO power into four categories. For CEOs with high structural rights, there is no taxation avoidance significance. CEOs with high ownership power exhibit taxation behavior consistent with the convergence-of-interest hypothesis. They reduce tax avoidance while seeking their own interests. Based on their professional experience, CEOs with strong expert power are vigilant about reputational risks; hence, they avoid tax avoidance and have a conservative approach to investments. CEOs with high prestige power can learn from their networks about seasoned practices in tax avoidance who are proactive in tax avoidance Keywords: Tax Avoidance; CEO Power; Book-tax Differences (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ibf:gjbres:v:14:y:2020:i:1:p:1-27 Access Statistics for this article Global Journal of Business Research is currently edited by Terrance Jalbert More articles in Global Journal of Business Research from The Institute for Business and Finance Research |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.