Comparison of the Effect of Readability of Direct Tax law on Business Tax Risk
Subject Areas : business management
saeed mohammadi
1
(Department of Accounting, Central Tehran Branch, Islamic Azad University, Tehran, Iran)
zahra pourzamani
2
(.. Department of Accounting, Central Tehran Branch, Islamic Azad University, Tehran, Iran)
Keywords: readability, Direct Tax Act, Flash Method, Close Method, Tax Risk,
Abstract :
This study investigated the effect of the readability of the Direct Tax Act on tax risk was examined and a comparison was made between the tax risk prior to and after the amendment of the Act. The data on 37 companies listed on the Tehran Stock Exchange was collected . The results showed that according to the flash method, the chapter on Exemption is the most difficult chapter in terms of readability level and the chapter on the Order of Proceedings is the simplest chapter in the Direct Tax Act. Additionally, the results of the close method for the tax auditors and financial managers were consistent with the results of the flash method. According to the result of the close method for tax auditors, the chapters on Exemption and the Order of Proceedings had intermediate and independent levels of readability respectively. For financial managers, the two chapters had intermediate levels of readability. The results also showed that the readability of the Direct Tax Act had no effect on tax risk. Moreover, the results of the test of the second hypothesis showed that there was no significant difference between tax risk prior to and after the amendment of the Act.
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