A Research On The Influences Brought By Stock Price Crash Risks To Corporate Tax Avoidance Behaviors Of China's Manufacturing Listed Companies

The stock market has been unstable since last century.Risks of Stock Price's collapse,which was caused by massive decreasing stock price in a short period,have been severely interfering with the normal functioning of financial market and equipment efficiency of capital market.Therefore supervisors,investors and the academia have been widely researching on controlling stock price crash risks.Current researches have been carried out mainly to form analysis on the factors of stock price crash risk while few scholars have researched on the economic consequences of stock price crash.The writer conducts analysis from the perspective of investors and find that corporate tax avoidance behaviors lay an impact on corporate investment from investors,which leads to an underestimation on corporate worth hence to cause a fall of stock price.Therefore,if stock price crash risk happens,companies are most likely to take less corporate tax avoidance behaviors.Based on this and according to our predecessors' researches,we find that,the intensity of tax collection and management,has a restrictive effect on corporate tax avoidance and a connection to stock price crash risks.Therefore,intensity of tax collection and management,as a variable,is brought into this thesis to carry out evident analysis on interrelationship among stock price crash risks,intensity of tax collection and management and corporate tax avoidance behaviors,which is based on tax-shelter theories,principal-agent theories,asymmetric information theories and tax compliance theories.By studyingthese problems,this article has certain practical and theoretical significance to reduce financial risks in China's capital market,stabilize the stock market and protect the interests of investors.Manufacturing industry,as one of the pillar industries,the upgrading and transforming of which have become an essential task for China.Manufacturing is the industrial foundation of a country.Therefore,this thesis selects the A-share manufacturing industry firms listed in Shanghai and Shenzhen from 2007 to 2016 as a sample to research on the relations between stock price crash risks and corporate tax avoidance behaviors and observe the roles tax collection and management play on it.All the researches were done through a combination of theoretical analysis with use of STATA.14 statistics application to study relevant panel data.Evidence shows that the bigger risks that the crash of stock price has,the more likely firms will avoid a further stock price decrease through cutting down tax avoidance behaviors.Meanwhile,changes of intensity of tax collection and management don't work out in the influence brought by stock price crash risks to corporate tax avoidance behaviors.Based on the above conclusions,this thesis conveys a suggestion that corporate executive levels and board of directors should consider both pros and cons in terms of taking tax-shelter behaviors,make reasonable tax plans,optimize the corporate management systems and enhance the awareness of conforming to pay tax according to laws to avoid re-management concerned with the emergence of corporate stock price crash risks.Another suggestion is that government agencies should play a role as a supervisor to shock corporate tax avoidance behaviors,amplify the intensity of inspection and promote tax laws to enhance the awareness to pay taxes,ensure the financial incomes and maintain a vigorous market economy.The whole article is divided into six parts: The fist part is the introduction,the background,purpose and meaning,as well as researchideas and innovation.The second part involve explaining concepts and the literature review.First,this paper defines the conception of stock price crash risks,tax avoidance behaviors,intensity of tax collection and management.Then,This paper summarizes the domestic and foreign research achievements related to stock price crash risks and intensity of tax collection,and analyzes between stock price crash risks,intensity of tax collection and management and corporate tax avoidance behaviors,which is based on the literature review.The third part is theoretical foundation.This part is brought into this thesis to carry out evident analysis on interrelationship among stock price crash risks,intensity of tax collection and management and corporate tax avoidance behaviors,which is based on tax-shelter theories,principal-agent theories,asymmetric information theories and tax compliance theories.The fourth part is the empirical research part.This part is to provide the basis foregoing literature review and theoretical overview of the research hypotheses,and select the relevant data of the A-share manufacturing industry firms listed in Shanghai and Shenzhen from 2007 to 2016,and do the descriptive analysis,correlation analysis,regression analysis and expanding analysis of the results of data processing and to do the empirical test of the proposed hypotheses.The fifth part is the conclusion and policy recommendations.The sixth part is the shortcomings of this study and prospect.