Research On IPO And The Tax Avoidance In Perspective Of Information Disclosure

Tax avoidance and mechanism design are the classic topics of finance.To be more specific,there are plenty of research about tax avoidance,but few of them are concerned about the relationship between tax avoidance and information asymmetry.This paper uses the Annual Survey of Industrial Firms Database from China National Bureau of Statistics and Wind Public companies' financial dataset with sample period of 1998 to 2009 to analyze the effect of information disclosure on firms' incentive to avoid tax.And we study four different kinds of taxes such as income tax,value-added tax,other taxes and social security cost.We find that the reduction of information asymmetry will lead to significantly less degree of income tax avoidance.However there are not significant influence on value-added tax and other taxes and adverse influence in social security.The conclusion is robust when we change the database,regression assumptions or index of tax avoidance.In terms of heterogeneity test,we find that: First of all,SOE firms have lower tax avoidance rate compared with Non-SOE firms.Second,firms with lower tax rate tend to have lower tax avoidance rate.Last but not least,debt-asset ratio,tangible asset ratio,cash ratio and firm size also have influence on the degree of firms' tax avoidance.