scholarly journals The tendency to tax avoidance and tax evasion in the light of Kohlberg’s theory of moral development – ethical issues in accounting practice

2016 ◽  
Vol 2016 (86(142)) ◽  
pp. 35-52
Author(s):  
Sabina Kołodziej ◽  
Ewa Maruszewska
Keyword(s):  
Moral Development ◽  
Tax Evasion ◽  
Ethical Issues ◽  
Tax Avoidance ◽  
Accounting Education ◽  
Ethical Awareness ◽  
Legal Norms ◽  
Legal Standards ◽  
Accounting Practice ◽  
Accounting Professionals

Modern accounting professionals are in charge of tools that, apart from enabling them to keep businessaccounts, may also be used to distort the picture of the financial situation of an entity, as well as to manipulatetax settlements. Therefore, accounting professionals not only should possess the necessaryknowledge, but also should apply ethical standards in their work. These two components guarantee thecorrectness of tax settlements and the faithful representation of economic reality in the accounting system.The aim of this article is to present the results of analysis of the frequency of making accounting choices aimed at reducing the tax burden through breaking ethical or legal norms. In addition, the rela-tionship between the tendency to make decisions leading to tax avoidance or tax evasion and the reasons behind it (according to Kohlberg’s theory of moral development) have been analysed. The results indicate higher frequency of decisions aimed at lowering tax liabilities due to the failure to follow ethical stand-ards than due to breaking ethical and legal standards at the same time. It was also pointed out that the tendency to make unethical (and illegal) decisions was associated with low levels of moral reasoning, which confirms the importance of the postulate to supplement accounting education with accountability and ethical awareness issues.

scholarly journals The Effects of Socio-Cultural Context on Breach of Accounting ethics: A Grounded Theory Study

2020 ◽  
Vol 6 (4) ◽  
Author(s):  
Ilyas Sharif ◽  
Muhammad Junaid ◽  
Fazal Malik
Keyword(s):  
Grounded Theory ◽  
Tax Evasion ◽  
Cultural Context ◽  
Negative Impact ◽  
Tax Avoidance ◽  
Accounting Education ◽  
Constructivist Grounded Theory ◽  
Research Approach ◽  
Key Stakeholders ◽  
Social And Cultural Factors

This study explores intuitions of accounting education key stakeholders in Khyber Pakhtunkhwa, Pakistan that what are the effects of social and cultural factors on ethical breaches of accountants and tax evasion. Individual and organizational decisions are based on accounting yet, social and cultural obligations coerce accountants on manipulation of accounts for tax evasion that has negative impact of national exchequer. This study attempts to realize insights of important stakeholders about AE through methodical support of its multifaceted angles. Literature highlights that personal, organizational (multi)national decisions are based on accounting information. Stakeholders’ theory lens is applied as it is widely used in accounting research. Researchers have applied qualitative research approach to provoke 25 open-ended interviews of respondents like, accounting teachers, students, professionals, employers, recruiting agencies and their parents. Data are analyzed through constructivist grounded theory. Findings show that excessive social demands compel accountants on unethical accounting practices for tax evasion that is detrimental for the nation as it makes corruption acceptability in society. In context of the study, weak academic and HR policies lead to appointment of less relevant persons for leading accounting seats. Recommendations of the study are societal interventions, academic endorsements, regulatory and legislative suggestions for eradication of ethical breaches by accountants generally and tax avoidance specifically.

scholarly journals Tax Avoidance in Albania

2020 ◽  
Vol 6 (3) ◽  
pp. 124
Author(s):  
Viola Tanto
Keyword(s):  
Tax Evasion ◽  
Reference Model ◽  
Small And Medium Enterprises ◽  
Burden Of Proof ◽  
Tax Avoidance ◽  
Tax Administration ◽  
The European Union ◽  
Legal Norms ◽  
Special Cases ◽  
Medium Enterprises

This paper was written in order of the reforming of the tax system’s framework. Analysing phenomena such as tax evasion, tax avoidance, the use of legal loopholes to reduce tax liability in Albania was very challenged. In this paper is analysed also some other jurisdictions, which have served as a reference model for the reform of Albanian legislation, such as the Italian one and the legislation of the European Union. Recently, we were witnesses of a significant increase, in the quantitative and qualitative level, of tax evasion and tax avoidance. Often, the "battle" between the taxpayer and the contributor in bad faith is based on the probative power (burden of proof) of the elements of the transaction which must be verified by the tax administration. Even more often, this fight takes place over the basis of the correct interpretation of legal norms. Evasion is leaving more and more room for refined avoidance. Avoidance is no longer just the prerogative of big companies, corporations or powerful business groups, but it is turned into an ordinary management instrument for small and medium enterprises, even in special cases, even for natural persons. The paper analyses problems such as: basic and key aspects of tax evasion, by distinguishing with other concepts of tax law, such as tax planning and tax evasion, which are the forms of identifying tax evasion/avoidance, the meaning of the doctrine of abuse right. At the end of the paper, you can find a presentation on all findings and conclusions reached during the analysis of the above problems, and some recommendations for the improvement of the activity of the Tax Administration.

scholarly journals Inter-Company Investments Between Affiliates Of Multinational Enterprises: Applying The Substance-Over-Form Doctrine To Distinguish Equity From Debt

2011 ◽  
Vol 2 (10) ◽  
Author(s):  
David W. LaRue ◽  
Steven C. Thompson
Keyword(s):  
Tax Evasion ◽  
Multinational Enterprises ◽  
Ethical Issues ◽  
Tax Avoidance ◽  
Financial Accounting ◽  
Taxable Income ◽  
Wide Range ◽  
Tax Haven ◽  
Withholding Taxes ◽  
The U.S

The classification of a financial instrument as “debt” or as “equity” is crucial in applying a wide range of income tax provisions.  “Interest” expenses incurred on “debt,” for example, are deductible in computing a firm’s taxable income, whereas “dividends” paid on the firm’s outstanding “equity” are not.  “Interest” paid by a U.S. corporation to a foreign creditor is generally not subject to U.S. withholding taxes, whereas “dividends” paid on stock held by a foreign shareholder are typically subject to U.S. withholding taxes that range from 5% to 30% of the gross amount of the dividend paid.  And the list goes on . . . .  Not surprisingly, these disparities in tax treatment have inspired a plethora of schemes, many of them successful, designed to disguise equity investments as “debt.”  The urge to do so is perhaps nowhere more intense than in situations where the “debt” of a U.S. corporation is held by a foreign sister corporation located in a tax haven country.  Interest paid or accrued on debt would be deductible in computing the U.S. corporation’s U.S. taxable income, and would thereby permanently reduce the debtor’s U.S. tax liability.  The interest income earned by the foreign creditor would be exempt from both U.S. withholding taxes and income taxes in the foreign tax haven country.  This interdisciplinary case was developed from the facts and circumstances before the U.S. Tax Court in litigation that resulted from the government’s assertion that $975 million in “loans” made by a wholly owned Dutch subsidiary of Laidlaw Transit, Ltd. to several of Laidlaw’s U.S. subsidiaries were in substance “equity.”   As in most debt-versus-equity cases, the stakes were high:  Laidlaw’s U.S. subsidiaries had deducted over $133 million of intercompany “payments” made to their Dutch sister corporation as “interest expense” and the IRS was suing to recover $52 million in back taxes (plus interest and penalties).  This case integrates three disciplines – tax accounting, financial accounting, and finance -- in an easy-to-comprehend, yet rich setting appropriate for general management, finance, and accounting audiences.  It invites students to thoroughly explore the substance-over-form doctrine as it applies to the debt-versus-equity issue, together with many of the tax, financial, accounting, and economic ramifications that flow from an instrument’s classification.  It also provides students with an opportunity to identify the ethical issues that attend the formulation and implementation of many tax minimization strategies and to identify factors that separate legal “tax avoidance” from criminal “tax evasion.”

scholarly journals Accounting Practitioners Reflect On Faculty Impact: Bridging The Gap Between Theory And Practice

2014 ◽  
Vol 7 (2) ◽  
pp. 109-114
Author(s):  
Ryan Johnson
Keyword(s):  
Faculty Members ◽  
Theory And Practice ◽  
Accounting Education ◽  
Entry Point ◽  
Accounting Practice ◽  
Accounting Professionals ◽  
Accounting Practitioners ◽  
Academic Faculty ◽  
Perception Gap ◽  
The Impact

A gap exists between the perception of accounting education in the classroom and accounting as it is practiced. This study explores qualitatively the perceptions and experiences of mid-career accounting professionals with respect to the impact of academic faculty on their careers in accounting. The study identifies a perception gap in the experiences of accounting practitioners and explores the reasons for and significance of this gap. The study also explores the ways in which faculty members can positively impact practitioners, such as providing a smooth entry point into the profession, as well as provides a roadmap for greater articulation between the accounting education and accounting practice.

Pengaruh Konvergensi International Financial Reporting Standards (Ifrs) Terhadap Penghindaran Pajak(Tax Avoidance)

2018 ◽  
Vol 26 (2) ◽  
pp. 158-169
Author(s):  
Umi Wahidah ◽  
Sri Ayem
Keyword(s):  
Financial Reporting ◽  
Tax Evasion ◽  
Stock Exchange ◽  
Control Variable ◽  
Tax Avoidance ◽  
Sampling Technique ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Control Variables ◽  
Financial Reporting Standards

This research aimed to examine the effect of the convergence of International Financial Reporting Standards (IFRS) on tax avoidance on companies listed in Indonesia Stock Exchange. Tax avoidance that used in this research was Cash Efective Tax Rate (CETR). This research is also use the control variable to get other different influence that different such as CSR, size, and earning management (EM. This research used populations sector of transport service companies that listed in Indonesia Stock Exchange. The data of this research taken from secondary data that was from the Indonesia Stock Exchange in the form of Indonesian Capital Market Directory (ICMD) and the annual report of the company 2011-2015. The method of collecting sample was purposive sampling technique, the population that to be sampling in this research was populations that has the criteria of a particular sample. Companies that has the criteria of the research sample as many as 78 companies. The method of analysis used in this research is multiple regression analysis. Based on regression testing shows that the convergence of International Financial Reporting Standards (IFRS) has a positiveand significant impact on tax evasion. This shows that IFRS convergence actually improves tax evasion practices. The control variables of firm size and earnings management also significantly influence the application of IFRS in improving tax avoidance practices, while CSR control variables have no role in convergence IFRS in improving tax evasion practice.

Legal Considerations of Tax Evasion and Tax Avoidance

2004 ◽  
Vol 26 (1) ◽  
pp. 41-85 ◽  
Author(s):  
Dániel Deák
Keyword(s):  
Tax Evasion ◽  
Tax Avoidance

Workplace Mindfulness in Accounting Practice: Issues, Opportunities, and Challenges

2019 ◽  
Vol 33 (4) ◽  
pp. 167-185
Author(s):  
Yu-Tzu Chang ◽  
Dan N. Stone
Keyword(s):  
Job Performance ◽  
Work Outcomes ◽  
Review Of Literature ◽  
Accounting Firms ◽  
Accounting Practice ◽  
Accounting Professionals ◽  
Practice Opportunities ◽  
Reducing Stress ◽  
Jel Classifications

SYNOPSIS Research suggests that individual, secular mindfulness can improve work outcomes, including reducing stress and increasing attention, wellness, and job performance. This paper discusses the construct and efficacy of mindfulness and explores opportunities for and challenges to integrating workplace mindfulness in professional accounting. Evidence from websites suggests that most large accounting firms promote workplace mindfulness to their clients and that some (e.g., EY and PWC) promote its practice among their accounting professionals. While a review of literature indicates support for some claimed benefits, workplace mindfulness is no panacea. Challenges to workplace mindfulness include the unwillingness of some accounting professionals to practice mindfulness and that some claimed benefits, e.g., improved leadership and teamwork, are not well-supported by research. The paper concludes by proposing a set of workplace mindfulness issues and practice opportunities and discussing impediments to and the limits of mindfulness in professional accounting. JEL Classifications: M40; M41; M42.

Brewing Up Controversy: A Case Exploring the Ethics of Corporate Tax Planning

2015 ◽  
Vol 30 (4) ◽  
pp. 311-327 ◽  
Author(s):  
Megan F. Hess ◽  
Raquel Meyer Alexander
Keyword(s):  
Real World ◽  
Ethical Issues ◽  
Tax Avoidance ◽  
Tax Planning ◽  
Learning Assessment ◽  
Class Discussion ◽  
Corporate Tax ◽  
Tax Havens ◽  
Multinational Organizations ◽  
The U.S

ABSTRACT This instructional case explores the ethical issues surrounding the corporate tax-planning and tax-avoidance strategies of multinational organizations. Drawing on the real-world experiences of SABMiller, one of the world's largest beverage companies, this case provides a launching point for students to consider the ethics of corporate tax planning. The ethics of multinational tax practices, especially the use of tax havens, has recently become the focus of media and legislative debate in both the U.S. and the U.K., and many well-respected companies, such as General Electric, Apple Inc., and Starbucks are now feeling the pressure to reform. In a post-case learning assessment, students demonstrated significant improvement in their understanding and indicated that they enjoyed discussing this controversial issue. The “Implementation Guidance” section and Teaching Notes offer guidance for in-class discussion of the ethical and tax issues in this case.

Curbing Illicit Financial Flows

2018 ◽  
Author(s):  
Xiaodon Liang
Keyword(s):  
Tax Evasion ◽  
Developing Economies ◽  
International System ◽  
Tax Avoidance ◽  
Incentive Structure ◽  
Global Finance ◽  
Tax Havens ◽  
Financial Flows ◽  
Playing Field ◽  
Illicit Financial Flows

Illicit financial flows (IFFs) drain state finances and economic vitality, with disproportionate impact on developing economies. IFFs—including money laundering, tax evasion, and tax avoidance—pose a transnational problem addressed so far through international regimes of coordination and cooperation. But meaningful reductions in IFFs require addressing the root of the problem: information asymmetries. Developed nations and tax havens know where money is hidden and profits are made, while developing nations do not. Since the international system of global finance creates the incentive structure and permissive environment for illicit flows, it is at this level that states must focus their policy-making attention. New information-sharing mechanisms, such as automatic exchange of tax information and public country-by-country tax reporting, can level the playing field and enable lower-income states to effectively address the IFF problem.

Illegal migration as an encroachment on the sovereignty and security of the state

2021 ◽  
pp. 341-352
Author(s):  
Sergey D. Grinko
Keyword(s):  
International Law ◽  
Organized Crime ◽  
Drug Trafficking ◽  
Tax Evasion ◽  
Illegal Migration ◽  
Legal Norms ◽  
World Community ◽  
Large Length ◽  
The Subject ◽  
Entire World

We consider the issues of correlation between the international law of citizens of different states to travel and national legislation restricting illegal migration, which are the subject of interstate agreements. The issue of combating organized illegal migration for Russia is urgent, since the dynam-ics of this crime indicates an increase in the registration of such crimes and the identified persons who committed them. This is due to the large length of Russian borders and integration with foreign states, which entails an increase in the penetration of foreign citizens into the territory of our country. Illegal migration leads to an increase in ethnic organized crime and related smug-gling, drug trafficking, tax evasion and extortion. The fight against this criminal phenomenon is relevant for the entire world community. States seek to protect their citizens, but at the same time are obliged to comply with in-ternational legal norms on the issue under consideration. This activity of states should be carried out in accordance with the principles of respect for human rights and freedoms. We analyze international and Russian legisla-tion, damage caused by illegal migration, and propose measures to prevent crime related to illegal migration.

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