Do family firms engage in less tax avoidance than non-family firms? The corporate opacity perspective

Cheng Hsun Lee, Sudipta Bose

Research output: Contribution to journalArticlepeer-review

5 Citations (Scopus)

Abstract

We examine the moderating effect of corporate opacity on the relationship between family firms and tax avoidance. We find, ceteris paribus, that family firms and tax avoidance are negatively associated. However, the negative association is attenuated when corporate opacity increases. Our results indicate that corporate opacity affects firms’ tax avoidance, with this effect stronger for family firms than for non-family firms. We also find that tax avoidance by and corporate opacity of family firms are negatively associated with firm valuation. These results are consistent with the opportunistic perspective that family firms engage in more tax avoidance than non-family firms when corporate opacity is higher.

Original languageEnglish
Article number100263
JournalJournal of Contemporary Accounting and Economics
Volume17
Issue number2
DOIs
Publication statusPublished - 2021 Aug

All Science Journal Classification (ASJC) codes

  • Accounting

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