scholarly journals Empirical Approach of Tax Avoidance Risk Assessment

2018 ◽  
Vol 2 (1) ◽  
pp. 52-69
Author(s):  
Agung Endika Satyadini
Keyword(s):  
Risk Assessment ◽  
Brain Area ◽  
Academic Research ◽  
Tax Avoidance ◽  
Tax Compliance ◽  
Policy Formulation ◽  
Empirical Approach ◽  
Strategy Formulation ◽  
Permanent Establishment ◽  
Audit Strategy

This study analyzes tax avoidance risk assessment including dimension and magnitude of tax avoidance risk exposure using several enterprise-related and government-related variables. Providing far-reaching analysis and examining a relatively unexplored area of conforming tax avoidance, this study employs two measurements of tax avoidance including non-conforming and conforming tax avoidance. As an extensive analysis, this paper also examines the magnitude of tax avoidance responsiveness with respect to different types of enterprises including Permanent Establishment and foreign-invested enterprises. The results drawn from this study are paramount as the empirical approach to in tax policy formulation. Risk profiles suggested in this research are pertinent to risk engine of Compliance Risk Management (CRM) and also beneficial for Risk-Based Audit strategy formulation. Ensuring the best-fit policy formulation, these results revealed that application of tax authority’s strategy to hike tax compliance should be more likely to prevention rather than reaction. Furthermore, in the brain area of academic research, the findings also contribute to the field of tax literature by providing simultaneous empirical models including conforming and non-conforming tax avoidance model, which has been relatively unexplored in prior studies.

Risk assessment of mining projects in Ghana

2017 ◽  
Vol 23 (1) ◽  
pp. 22-38 ◽  
Author(s):  
Charles Teye Amoatey ◽  
Samuel Famiyeh ◽  
Peter Andoh
Keyword(s):  
Risk Factors ◽  
Risk Assessment ◽  
Academic Research ◽  
Mining Industry ◽  
Commodity Prices ◽  
Mitigation Measures ◽  
Content Type ◽  
Management Culture ◽  
Mining Project ◽  
Mining Projects

Purpose The purpose of this paper is to assess the critical risk factors affecting mining projects in Ghana. Design/methodology/approach A purposive sampling approach was used in selecting the respondents for the study. These were practitioners working on mining projects in Ghana. Findings The study identified 22 risk factors contributing to mining project failure in Ghana. The five most critical mining project risk factors based on both probability of occurrence and impact were unstable commodity prices, inflation/exchange rate, land degradation, high cost of living and government bureaucracy for obtaining licenses. Mitigation measures for addressing the identified risk factors were identified. Research limitations/implications This paper is limited to data collected from practitioners working on mining projects. Due to geographic and logistical constraints, the study did not include the perception of local communities in quantifying the risk factors. Practical implications This paper has documented the critical risk factor affecting the mining industry in Ghana. Though the identified risk types are also prevalent in other sectors of the construction industry, the key findings of this paper emphasize the need for a comprehensive risk management culture in the mining sector. From an academic research perspective, the paper contributes to a conceptual risk assessment framework. Originality/value The information gathered through this research can be utilized in identifying and understanding risks during the early stages of mining project implementation.

scholarly journals Tax Compliance Decision Analysis: Audit Strategy, Audit Rate, Perceived Probability of Audit, and Taxpayer Ethics

2016 ◽  
Vol 8 (3) ◽  
pp. 11-21
Author(s):  
Meinarni Asnawi
Keyword(s):  
Empirical Evidence ◽  
Tax Compliance ◽  
Laboratory Method ◽  
Random Group ◽  
Fixed Group ◽  
Multiple Treatment ◽  
Experimental Laboratory ◽  
Audit Strategy ◽  
Indirect Relationship ◽  
Perceived Probability

This study aims to provide empirical evidence that audit strategy, audit rate, perceived probability of audit and taxpayer ethics have impact on tax compliance. This Research employs the experimental laboratory method with multiple treatment design to refer behavioral change in tax compliance decision. 156 voluntary student participants were recruited from three major; accounting, management, and economics major. The participants grouped into random and fixed group adaptable with audit strategy treatment. Random selection is used to establish participant to each group. Audit rate treatment was classified in four audit level; uninformed audit rate, 10%, 20%, and finally 30%. Perceived probability of audit treatment; subjects determine the percentage of perceived audit. Furthermore taxpayer ethics treatment uses tax ethics film. The results provide empirical evidence that in the random group, strategy random audit, audit rate, perceived probability of audit and taxpayer ethics have significant relationship with tax compliance decision. Conversely, fixed group disprove that audit fixed strategy insignificantly with tax compliance decisions. Audit fixed strategy and audit rate have indirect relationship to tax compliance decision by perceived probability of audit. These results from both of group may suggest that taxpayers will increase the tax compliance decision when his possibility to be audited is high. Taxpayer ethics has significant impact on tax compliance decision at all audit level. Taxpayer ethics plays an important role of increased tax compliance decision. This study has implication for judgment theory to consider taxpayer ethics.

scholarly journals Taxing Micro, Small and Medium Enterprises in Yogyakarta: Regulation and Compliance

BESTUUR ◽  
2021 ◽  
Vol 9 (1) ◽  
pp. 59
Author(s):  
Siti Rahma Novikasari ◽  
Duc Quang Ly ◽  
Kerry Gershaneck
Keyword(s):  
Tax Policy ◽  
Income Tax ◽  
Government Regulation ◽  
Small And Medium Enterprises ◽  
Tax Avoidance ◽  
Tax Compliance ◽  
Legal Compliance ◽  
The Government ◽  
Medium Enterprises ◽  
Compliance Constraints

<p>Government Regulation No. 46/2013 has not been optimal in providing legal compliance on taxation for Micro, Small, and Medium Enterprises (MSMEs), especially in Yogyakarta. This policy was evaluated and amended with Government Regulation No. 23/2018. The amendment in tax policy for MSME actors was this research background to examine: First, how does the final income tax policy impact MSME taxpayers' compliance in Yogyakarta? Second, what are the legal compliance constraints of MSME taxpayers? The method used in this research was a juridical empirical, supported with the statute and conceptual approach. The results showed that the amendment in the final income tax tariff policy from 1% to 0.5%, as well as provide legal certainty of the timeframe of taxation had a positive impact on increasing taxpayer compliance. There was an increase in the number of taxpayers to 41,000 in 2019, or an increase of 15.5% compared to the number of taxpayers in 2017. However, tariff reduction has not been the answer to taxpayer non-compliance, the Regional Office of the Directorate General of Taxes of the Special Region of Yogyakarta still found tax avoidance. Tax compliance constraints were also caused by taxpayers' distrust of the government, poor tax morale, and tax knowledge. The government needs to conduct a cooperative compliance approach in taxation policies based on trust and dialogue between taxpayers and the government to improve MSME taxpayer compliance.</p><p><strong>Keywords:</strong> Tax Compliance; Final Income Tax Regulation; Micro; Small; Medium Enterprises.</p>

scholarly journals Covid-19 and corporate tax avoidance: Measuring long-run tax burdens as an alternative bailout test

2021 ◽  
Vol 4 (3) ◽  
pp. 216-244
Author(s):  
Subagio Efendi
Keyword(s):  
Financial Aid ◽  
Income Tax ◽  
Tax Avoidance ◽  
Tax Compliance ◽  
Total Sample ◽  
Ordinary Least Squares ◽  
Corporate Tax ◽  
Long Run ◽  
Tax Returns ◽  
Avoidance Measures

This study fills the gap in the tax authority’s Covid-19 financial aid verifications by examining, and nominating, Long-run ETR (Dyreng et al., 2008) as the better corporate tax avoidance measure in excluding tax evader firms from the broad stimulus programs. Analysing confidential tax returns of 4,752 largest firms (32,120 firm-years) in Indonesia over 2009 to 2017 periods, this study found 18.12 percent of total sample firms is able to retain its Long-run ETR below 10 percent, which indicates continual tax avoidance activities by these firms during observation periods. Moreover, applying univariate and multivariate Ordinary Least Squares and Panel Data estimations, this study reveals, relative to other tax avoidance measures, Lagged Cash ETR (Lisowsky, 2010; Lisowsky et al., 2013) present the most consistent reliability in predicting long-run income tax burdens. Thus, this study asserts, in the conditions of computing Long-run ETR is costly and impractical (i.e. because of data unavailability), tax authority and policymakers can directly analyse firms’ Lagged Cash ETR to gauge their long-run income tax burdens and tax compliance behaviours prior the economic downturn. 

scholarly journals Permanent establishment as a foreign direct investment in Poland: identification of tax barriers in the context of new tax development

2021 ◽  
Vol 57 (2) ◽  
pp. 177-193
Author(s):  
Marcin Jamroży ◽  
Magdalena Janiszewska
Keyword(s):  
Foreign Direct Investment ◽  
Economic Activity ◽  
Direct Investment ◽  
Business Models ◽  
Tax Avoidance ◽  
Tax Law ◽  
Profit Shifting ◽  
New Developments ◽  
Permanent Establishment ◽  
International Tax

Abstract The paper aims to identify the significant tax barriers to foreign direct investment (FDI) in Poland, in particular in the form of a permanent establishment (PE), in the context of new developments in international tax law. Due to the recommendations of the Base Erosion and Profit Shifting (BEPS) project, launched by Organisation for Economic Co-operation and Development (OECD) to prevent international tax avoidance, the understanding of PE has changed, which could lead to changes in business models. The purpose of the research is also to identify the significant tax barriers to economic activity in Poland, in particular in the form of PE, against the international tax law context. The study conducted by the authors relies on the most current tax rulings and judgments of administrative courts issued between 2017 and 2020. It is concluded that not so much the effective tax burdens but the regulatory ambiguity surrounding the tax obligations may contribute to the reduction of Poland's attractiveness as a location for FDI.

The Association between Auditor Provided Tax Planning and Tax Compliance Services and Tax Avoidance and Tax Risk

2021 ◽  
Author(s):  
James A. Chyz ◽  
Ronen Gal-Or ◽  
Vic Naiker ◽  
Divesh S. Sharma
Keyword(s):  
Tax Avoidance ◽  
Tax Compliance ◽  
Tax Planning

This study examines associations between auditor-provided tax compliance and tax planning services and tax avoidance and tax risk. Collectively, our results suggest that companies paying their auditors for tax planning advice are more effective tax planners (in terms of higher tax avoidance, and lower tax risk) than firms that do not engage their auditor for tax work. Our tax avoidance results are more pronounced for clients of auditors with more tax expertise and longer tenure as well as for firms with higher tax and operational complexity. We also find that our tax avoidance results hold only when firms also engage their auditors for tax compliance work, which is consistent with auditors seeking to minimize reputation threats. Our study's unique hand-collected panel dataset provides a more precise and nuanced perspective on the role auditors play in tax outcomes.

The Interrelationship between Estimated Tax Payments and Taxpayer Compliance

2002 ◽  
Vol 24 (s-1) ◽  
pp. 27-45 ◽  
Author(s):  
Glenn D. Feltham ◽  
Suzanne M. Paquette
Keyword(s):  
Cost Of Capital ◽  
Tax Compliance ◽  
Theoretic Model ◽  
High Type ◽  
Compliance Behavior ◽  
Game Theoretic ◽  
Game Theoretic Model ◽  
Audit Strategy ◽  
Tax Payments ◽  
The Cost

This paper examines taxpayers' compliance behavior and the tax agency's audit decision in a broader, more realistic, setting. Whereas prior research has taken the taxpayer's prepayment position as exogenous, this study extends the literature by incorporating the estimated tax payment decision into a tax compliance game. A two-period game-theoretic model is used to examine the effect that the estimated tax payment rules have on taxpayers' incentives to evade and on the tax agency's audit strategy. Our primary results are as follows. First, in equilibrium taxpayers' estimated tax payment decision will depend upon the uncertainty about their true tax liability, and the cost from overpayment (the taxpayer's cost of capital) or underpayment (penalty interest) of installments of estimated tax. Second, under reasonable assumptions, high-type taxpayers who make higher installments of estimated tax are less likely to lie about their level of income than those who make lower installments—that is, taxpayers who pay low are more likely to evade. Third, the tax agency audits taxpayers who have made low reports and low estimated tax payments with a higher probability than those who have made high estimated tax payments. The gain to the tax agency from auditing taxpayers who make lower payments and evade arises not only from the penalties charged for evasion, but also from the interest charged on deficient installments of estimated tax.

What's in a Name?

2022 ◽  
pp. 228-242
Author(s):  
Larissa Batrancea
Keyword(s):  
Tax Evasion ◽  
Ethnic Diversity ◽  
Tax Avoidance ◽  
Tax Compliance ◽  
Factors Influencing ◽  
The Difference ◽  
The Impact ◽  
Complex Matter

The topic of tax behavior always stirs attention among scholars, professionals, national and international authorities, organizations, and citizens alike since it is a complex matter. There are four types of tax behavior acknowledged in the literature, namely voluntary tax compliance, enforced tax compliance, tax avoidance, tax evasion. The complexity of tax behavior stems from the fact that there are a manifold of factors influencing it, from economic to psychological ones. The chapter surveys relevant sources on tax behavior in the quest for eliciting the impact of ethnic diversity on tax compliance. At the same time, the difference between countries are also addressed.

Challenges of Monitoring Tax Compliance by Multinational Firms: Evidence from Chile

2019 ◽  
Vol 109 ◽  
pp. 500-505
Author(s):  
Sebastián Bustos ◽  
Dina Pomeranz ◽  
José Vila-Belda ◽  
Gabriel Zucman
Keyword(s):  
Multinational Firms ◽  
Transfer Pricing ◽  
Tax Avoidance ◽  
Tax Compliance ◽  
Tax Rates ◽  
Profit Shifting ◽  
Effective Tax Rates ◽  
Arm’S Length Principle ◽  
Debt Shifting

This paper reviews common challenges of taxing multinational firms, using Chile as a case study. We briefly describe key international tax avoidance methods: profit shifting to low-tax jurisdictions through transfer pricing and debt shifting. We discuss the prevalent policy to tax multinationals--the arm's length principle--and alternative proposals using apportionment formulas. Novel data from Chile show that multinationals make up a large share of GDP but report lower profit and effective tax rates than local firms. In 2011, Chile implemented a reform following OECD guidelines to enforce the arm's length principle. We discuss potential effects on tax collection and welfare.

scholarly journals Artificial Intelligence Based Commercial Risk Management Framework for SMEs

2019 ◽  
Vol 11 (16) ◽  
pp. 4501
Author(s):  
Gerda Žigienė ◽  
Egidijus Rybakovas ◽  
Robertas Alzbutas
Keyword(s):  
Artificial Intelligence ◽  
Risk Assessment ◽  
Risk Management ◽  
Academic Research ◽  
Building Blocks ◽  
Learning Technologies ◽  
Potential Contribution ◽  
Risk Management Framework ◽  
Development Goals ◽  
Risk Assessment And Management

Risk management in commercial processes is among the most important procedures affecting the competitiveness of small and medium-sized enterprises (SMEs), their innovativeness and potential contribution to global sustainable development goals (SDGs). The ecosystem of commercial processes is the prerequisite to manage risk faced by SMEs. Commercial risk assessment and management using elements of artificial intelligence, big data, and machine learning technologies could be developed and maintained as external services for a group of SMEs allowing to share costs and benefits. This paper aims to provide a conceptual framework of commercial risk assessment and management solution based on elements of artificial intelligence. This conceptualization is done on the background of scientific literature, policy documents, and risk management standards. Main building blocks of the framework in terms of commercial risk categories, data sources and workflow phases are presented in the article. Business companies, state policy, and academic research focused recommendations on the further development of the framework and its implementation are elaborated.

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