Are financial derivatives tax havens? Evidence from China
- Publisher:
- Emerald
- Publication Type:
- Journal Article
- Citation:
- International Journal of Emerging Markets, 2022, 17, (8), pp. 1949-1972
- Issue Date:
- 2022-11-24
Closed Access
| Filename | Description | Size | |||
|---|---|---|---|---|---|
| 10-1108_IJOEM-06-2020-0655.pdf | Published version | 188.45 kB |
Copyright Clearance Process
- Recently Added
- In Progress
- Closed Access
This item is closed access and not available.
Purpose The purpose of this study was to examine whether the use of financial derivatives by business enterprises can avoid taxes and whether tax authorities can detect and effectively enforce measures regarding this emerging tax avoidance method Design methodology approach Using panel data from the Shanghai and Shenzhen Stock Exchange listed companies from 2008 to 2019 this study used the Heckman self selection two stage model and a cross sectional analysis to test a total of 22 578 samples Moreover propensity score matching PSM instrumental variable and Heckman MLE methods were conducted in the robustness test Findings The results showed that enterprises could use financial derivatives to avoid taxation The greater the tax effort is the more obvious the effect of the company s use of financial derivatives for tax avoidance which proves challenging for tax authorities to identify and manage Originality value This study expands on research on corporate tax avoidance and provides a new perspective for the study of financial derivatives Moreover it improves relevant research in the field of tax regulation offering practical guidance for tax authorities to govern the use of financial instruments to prevent potential risks effectively 2021 Emerald Publishing Limited
Please use this identifier to cite or link to this item: