Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy

Purpose: Taxation basically occupies an important place in the strategic decisions of companies, therefore, business are thinking to adopt a dynamic and active method for tax management. This study examine the moderating role of board independence, and board size in the relation between tax avoidan...

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Autores principales:	Muhammad Husnain, Mumtaz Ahmad, Aijaz Mustafa Hashmi
Formato:	article
Lenguaje:	EN
Publicado:	CSRC Publishing 2021
Materias:	Board Structure Tax Avoidance Business Strategy Board Size Board Independences Finance HG1-9999
Acceso en línea:	https://doaj.org/article/5317f74f40774ab687c4a13a9f2e06c2
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spelling	oai:doaj.org-article:5317f74f40774ab687c4a13a9f2e06c22021-11-04T02:34:58ZAnalyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy10.26710/jafee.v7i3.19022519-03182518-8488https://doaj.org/article/5317f74f40774ab687c4a13a9f2e06c22021-09-01T00:00:00Zhttp://publishing.globalcsrc.org/ojs/index.php/jafee/article/view/1902https://doaj.org/toc/2519-0318https://doaj.org/toc/2518-8488 Purpose: Taxation basically occupies an important place in the strategic decisions of companies, therefore, business are thinking to adopt a dynamic and active method for tax management. This study examine the moderating role of board independence, and board size in the relation between tax avoidance, and business strategy in developing economy of the Pakistan. Design/Methodology/Approach: The sample of study consist of 125 non-financial companies listed on Pakistan stock exchange with time period of 5 years from 2013 to 2017 on annual basis. Study uses static (fixed effect, & random effect) and dynamic (GMM) panel data estimation techniques. Findings: The result shows that increase in board size of a prospector firm will increase its trend to avoid taxes. The finding also reveal that that an increase in the independent directors in prospector firms will decreases tax avoidance activities in emerging economies. Additionally, result shows that firm profitability and leverage are negatively related to tax payments while firm size show positive association with tax payments. Implications/Originality/Value: Among others, this study suggests that tax authorities should advocate the prospector firms to increase the number of independent directors on board because there presence cause a reduction in tax avoidance activities and increase tax payments. Muhammad HusnainMumtaz AhmadAijaz Mustafa HashmiCSRC PublishingarticleBoard StructureTax AvoidanceBusiness StrategyBoard SizeBoard IndependencesFinanceHG1-9999ENJournal of Accounting and Finance in Emerging Economies, Vol 7, Iss 3 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	Board Structure Tax Avoidance Business Strategy Board Size Board Independences Finance HG1-9999
spellingShingle	Board Structure Tax Avoidance Business Strategy Board Size Board Independences Finance HG1-9999 Muhammad Husnain Mumtaz Ahmad Aijaz Mustafa Hashmi Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
description	Purpose: Taxation basically occupies an important place in the strategic decisions of companies, therefore, business are thinking to adopt a dynamic and active method for tax management. This study examine the moderating role of board independence, and board size in the relation between tax avoidance, and business strategy in developing economy of the Pakistan. Design/Methodology/Approach: The sample of study consist of 125 non-financial companies listed on Pakistan stock exchange with time period of 5 years from 2013 to 2017 on annual basis. Study uses static (fixed effect, & random effect) and dynamic (GMM) panel data estimation techniques. Findings: The result shows that increase in board size of a prospector firm will increase its trend to avoid taxes. The finding also reveal that that an increase in the independent directors in prospector firms will decreases tax avoidance activities in emerging economies. Additionally, result shows that firm profitability and leverage are negatively related to tax payments while firm size show positive association with tax payments. Implications/Originality/Value: Among others, this study suggests that tax authorities should advocate the prospector firms to increase the number of independent directors on board because there presence cause a reduction in tax avoidance activities and increase tax payments.
format	article
author	Muhammad Husnain Mumtaz Ahmad Aijaz Mustafa Hashmi
author_facet	Muhammad Husnain Mumtaz Ahmad Aijaz Mustafa Hashmi
author_sort	Muhammad Husnain
title	Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
title_short	Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
title_full	Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
title_fullStr	Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
title_full_unstemmed	Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy
title_sort	analyzing the moderating role of board structure in relation between tax avoidance and business strategy: new insight from emerging economy
publisher	CSRC Publishing
publishDate	2021
url	https://doaj.org/article/5317f74f40774ab687c4a13a9f2e06c2
work_keys_str_mv	AT muhammadhusnain analyzingthemoderatingroleofboardstructureinrelationbetweentaxavoidanceandbusinessstrategynewinsightfromemergingeconomy AT mumtazahmad analyzingthemoderatingroleofboardstructureinrelationbetweentaxavoidanceandbusinessstrategynewinsightfromemergingeconomy AT aijazmustafahashmi analyzingthemoderatingroleofboardstructureinrelationbetweentaxavoidanceandbusinessstrategynewinsightfromemergingeconomy
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Analyzing the Moderating role of Board Structure in Relation between Tax Avoidance and Business Strategy: New Insight from Emerging Economy

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