Research On The Relationship Between Corporate Internal Control And Tax Risk

The innovation and change of the market operation model,the adjustment and promulgation of new policies and regulations,the business risks of enterprises are affected,especially tax risks,tax penalties will not only cause economic losses to enterprises,but also affect reputation and lead to production and activities of enterprises when serious.Both internal control and external control environment are important factors affecting the tax risk of enterprises,and this paper discusses the impact mechanism of internal control control on tax risk through theoretical analysis and empirical research,which plays an important role in the sustainable development of enterprises.This paper takes 2205 Listed Companies in China’s Shanghai and Shenzhen A-shares from 2018 to 2020 as a sample to study the relationship between internal control and tax risk inenterprises.Firstly,the research results on the relationship between internal control and tax risk of enterprises are sorted out,and the theoretical analysis and hypotheses are based on the theory of entrusted agency and risk management;secondly,the comprehensive evaluation index of tax risk is constructed through the analytic hierarchy method and the regression model is constructed;Finally,regression analysis is conducted to empirically study whether effective internal control can reduce the tax risk of enterprises,and group according to different tax control efforts to further study whether there are differences in the impact of internal control on tax risk.This article concludes that,first,the greater the role of an enterprise’s internal control system,the corresponding reduction in the tax risks it faces.Effective internal control can enable enterprises to form a good control environment,coupled with continuous improvement of constraint mechanisms and risk control measures,so as to control tax risks and minimize tax risks.Second,when the intensity of tax control is low,the stronger the ability of high-quality internal control to reduce tax risks.Under the low intensity of tax control and control,enterprises are more required to do a good job in early warning and management of tax risks.Finally,based on the conclusions of the study,a five-point proposal for reducing the tax risk of enterprises is proposed from the five elements of internal control.