The Effect of Information Transparency on the Relationship Between Tax Avoidance and Firm Value

Subject Areas : Management Accounting

Niloofar Abedi ¹ , Mehdi Safari Gerayli ²

1 - دانشجوی کارشناسی ارشد گروه حسابداری ،واحد گرگان ، دانشگاه آزاد اسلامی، گرگان ، ایران
2 - استادیار گروه حسابداری، واحد بندرگز، دانشگاه آزاد اسلامی، بندرگز، ایران.

Received: 2016-03-01 Accepted : 2016-04-14 Published : 2016-12-21

Keywords: Tax Avoidance, Firm Value, information transparency,

Abstract :

The present study is concerned with exploring the relationship between tax avoidance and firm value and investigating the moderating effect of information transparency on this relationship. Therefore, Bookkeeping Tax Difference (BTD) and Tobin's Q ratio are used to measure the tax avoidance. The research hypotheses are designed based on the data collected form a sample of 94 companies listed in Tehran Stock Exchange for the period 2011-2014 and then tested using multiple regression model on panel data. The results indicate that tax avoidance can cause a reduction in firm value. Moreover, the findings suggest that information transparency moderates the negative effect of tax avoidance on firm value. The results of this study not only fill the void of research in this area, but also assist investors, tax authorities and other stakeholders to decide on accounting information

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