Research On The Influence Of Strategic Deviance On Corporate Tax Avoidance

Tax avoidance is significant and common for firms around the world.The influencing factors of corporate tax avoidance has been increasingly concerned by academics and practice.Existing researches mainly focuses on the effect of corporate characteristics on tax avoidance,such as ownership structure,executive incentives and corporate governance.However,corporate strategy has been ignored in these researches.Corporate strategy is an important way for firms to achieve sustainable development and gain competitive advantage.Management needs to adjust business activities and financial decisions based on strategic changes,so different strategic characteristic will directly affect corporate financial characteristics and financial decision-making behavior.Thus,as an important part of financial decision-making,will corporate tax avoidance behavior be affected by strategic deviance? Furthermore,this paper analyzes whether the relationship between strategic deviance and corporate tax avoidance be affected by the nature of property and tax enforcement efficiency.This paper based on the strategic management theory,information asymmetry theory,financial constraint theory and agency theory of tax avoidance,and takes A-share listed companies of Shenzhen and Shanghai in China from 2008 to 2016 as the research sample.An empirical study is conducted to analyze the impact of strategic deviance on corporate tax avoidance.Meanwhile,it adopts group regression to study whether the impact of corporate strategic deviance on tax avoidance will be affected by the nature of property and tax enforcement efficiency.Furthermore,through the test of the mediation effect model,this paper excavates the mechanism of the relationship between strategic deviance and tax avoidance.The result shows that strategic deviance will increase the level of corporate financing constraints and management opportunistic behavior,thus increase the aggressiveness of tax avoidance.Meanwhile,non-state-owned companies enjoy less government support and preferential policies,so the positive correlation between corporate strategic deviance and tax avoidance is more obvious in non-state-owned listed companies.And the improvement of tax enforcement will reduce the positive correlation between corporate strategic deviance and tax avoidance.This conclusion further validates the external governance effect of tax enforcement.The analysis of the internal mechanism in further research indicates that financial constraint plays an intermediary role in the relationship between strategic deviance and corporate tax avoidance.This study notonly contributes to the related literature on the influencing factors of tax avoidance,but also provides new evidence for the research on the impact of corporate strategic deviance on financial decisions.