Foreign investors' interests and corporate tax avoidance: evidence from an emerging economy

Salihu, Ibrahim Aramide and Sheikh Obid, Siti Normala and Annuar, Hairul Azlan (2014) Foreign investors' interests and corporate tax avoidance: evidence from an emerging economy. In: Journal of Contemporary Accounting and Economics (JCAE) Symposium 2014, 3-4 Jan 2014, Campus of Monash University, Bandar Sunway, Petaling Jaya.

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Abstract

The inflows of foreign investments into the developing countries have called for concerns. The opportunity for profit shifting across their various operating outlets has made multinational companies tax avoidant in the host countries. This study, thus, examines the tax impact of foreign investors’ interests within the host developing economy. Using four similar measures of tax avoidance and three related measures of foreign investors’ interests, the sample data came from FTSE Bursa Malaysia Top 100 firms for the financial periods of 2009, 2010 and 2011. The analysis of the dynamic penal data using the system GMM estimator shows significant positive relationships between foreign investors’ interests and the measures of corporate tax avoidance among Malaysian large companies. Apart from being a useful guide for the selection of companies for tax audit, this result is also relevant for the proper evaluation of policies regarding foreign direct investment (FDI) in developing economies.

Item Type:	Conference or Workshop Item (Full Paper)
Additional Information:	842/36327 --Conference Proceedings Journal of Contemporary Accounting and Economics (JCAE) Symposium 2014, ISBN: 978-983-41627-4-0
Uncontrolled Keywords:	foreign direct investments, tax avoidance, system GMM estimator, developing economies
Subjects:	H Social Sciences > HF Commerce > HF5001 Business. Business Administration > HF5601 Accounting. Bookkeeping
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Kulliyyah of Economics and Management Sciences > Department of Accounting
Depositing User:	Dr Hairul Azlan Bin Annuar
Date Deposited:	11 Apr 2014 16:47
Last Modified:	16 Oct 2015 09:53
URI:	http://irep.iium.edu.my/id/eprint/36327

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