A Study On The Influencing Factors Of Book-Tax Difference

Book-Tax difference is always a hot topic in research field, which focuses on thedifference between accounting profit and taxable income. The influencing fact ors includeinstitutional factors, earnings management behavior and tax dodging behavior.Based on the amount of previous researches, it takes empirical approach to analyzethe differentiation that book-tax difference is affected by institutional factors, earning’smanagement behavior and tax dodging behavior in different kinds of enterprise,state-owned enterprise and non-state-owned enterprise respectively. In this paper, itselected the consolidated balance sheet of Shanghai and Shenzhen listed companies from2008to2012as research sample. From the prospective of institutional factors, thestate-owned-enterprises and non-state-owned-enterprises are essentially the same, exceptfor fixed asset depreciation. The empirical result shows that book-tax difference and fixedasset depreciation have significant positive correlation in the state-owned enterprise, butthe correlation is negative in the non-state-owned enterprise. So it indicates thatnon-state-owned-enterprises are more inclined to adopt accelerated depreciation. Earningsmanagement behaviors measured by discretionary accruals and book-tax differences havepositive correlation. Although the coefficient is not large, it shows that enterprises willreduce tax burden through non-taxable income when using earnings management, but theproportion is not large. The result also shows that it’s more pervasive thatnon-state-owned-enterprises exert influence on book-tax through earnings managementbehavior. As to tax dodging behavior, the influence on state-owned enterprise andnon-state-owned enterprise is in the same direction, but the cost of tax avoidance ofnon-state-owned enterprise is more than twice of state-owned enterprise. In addition, themore the book-tax difference, the larger the amount of tax avoidance and the amount oftax avoidance of non-state-owned enterprise are more than state-owned enterprise. In theory, this research has enriched the financial theory and provided reference for successor.The results of this research also have practical significance in enhancing the cooperationof accounting and tax, intensifying the collaboration between government and financialinstitution to govern the listed companies’ earnings management and tax dodgingbehaviors.