Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning

Tax gap measures differences between tax theoretically due and tax actually paid. Researchers and authority attribute tax gap as a measure of tax planning. At a firm level, the measure is often referred to book-tax difference (BTD), which has been utilised by researchers as a measure of tax planning...

Descripción completa

Guardado en:

Detalles Bibliográficos
Autor principal:	Nor Shaipah Abdul Wahab
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2016
Materias:	tax planning book-tax difference permanent difference temporary difference multinational companies Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/b253a23266484b5d8f7756ae52271f7a
Etiquetas:	Agregar Etiqueta Sin Etiquetas, Sea el primero en etiquetar este registro!

id	oai:doaj.org-article:b253a23266484b5d8f7756ae52271f7a
record_format	dspace
spelling	oai:doaj.org-article:b253a23266484b5d8f7756ae52271f7a2021-12-02T14:35:45ZMalaysian multinational companies (MNC): Permanent and temporary nature of tax planning2331-197510.1080/23311975.2016.1248644https://doaj.org/article/b253a23266484b5d8f7756ae52271f7a2016-12-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2016.1248644https://doaj.org/toc/2331-1975Tax gap measures differences between tax theoretically due and tax actually paid. Researchers and authority attribute tax gap as a measure of tax planning. At a firm level, the measure is often referred to book-tax difference (BTD), which has been utilised by researchers as a measure of tax planning given the unavailability of tax return data. In line with tax gap, BTD measures the extent taxable income deviates from the accounting income. As multinational companies (MNC) have more opportunities to effectively avoid tax than the domestic-only companies, it is hypothesised that the MNC’s permanent component of BTD (PD) differs significantly from the temporary component (TD). The sample is Bursa Malaysia-listed MNC and the data are drawn from Datastream and annual reports. Using a direct consistency test, this study reports the behaviour of BTD and its main components, PD and TD, over 2008–2014. To investigate whether BTD can be explained by firm-specific, the data are also analysed using panel regression models. Foreign sales, earnings management and auditor are found significant in explaining the aggregated tax planning measure. PD is found as not only the source of the relationship but also outweighs TD in explaining the relationship. This study contributes to literature and practice in terms of the nature and behaviour of BTD and its components using MNC settings. Findings on disaggregated BTD can be inferred to MNC’s effective tax planning strategies, particularly in addressing the questions or debates of whether the MNC have effectively utilised tax planning opportunities through permanent BTD.Nor Shaipah Abdul WahabTaylor & Francis Grouparticletax planningbook-tax differencepermanent differencetemporary differencemultinational companiesBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 3, Iss 1 (2016)
institution	DOAJ
collection	DOAJ
language	EN
topic	tax planning book-tax difference permanent difference temporary difference multinational companies Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	tax planning book-tax difference permanent difference temporary difference multinational companies Business HF5001-6182 Management. Industrial management HD28-70 Nor Shaipah Abdul Wahab Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
description	Tax gap measures differences between tax theoretically due and tax actually paid. Researchers and authority attribute tax gap as a measure of tax planning. At a firm level, the measure is often referred to book-tax difference (BTD), which has been utilised by researchers as a measure of tax planning given the unavailability of tax return data. In line with tax gap, BTD measures the extent taxable income deviates from the accounting income. As multinational companies (MNC) have more opportunities to effectively avoid tax than the domestic-only companies, it is hypothesised that the MNC’s permanent component of BTD (PD) differs significantly from the temporary component (TD). The sample is Bursa Malaysia-listed MNC and the data are drawn from Datastream and annual reports. Using a direct consistency test, this study reports the behaviour of BTD and its main components, PD and TD, over 2008–2014. To investigate whether BTD can be explained by firm-specific, the data are also analysed using panel regression models. Foreign sales, earnings management and auditor are found significant in explaining the aggregated tax planning measure. PD is found as not only the source of the relationship but also outweighs TD in explaining the relationship. This study contributes to literature and practice in terms of the nature and behaviour of BTD and its components using MNC settings. Findings on disaggregated BTD can be inferred to MNC’s effective tax planning strategies, particularly in addressing the questions or debates of whether the MNC have effectively utilised tax planning opportunities through permanent BTD.
format	article
author	Nor Shaipah Abdul Wahab
author_facet	Nor Shaipah Abdul Wahab
author_sort	Nor Shaipah Abdul Wahab
title	Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
title_short	Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
title_full	Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
title_fullStr	Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
title_full_unstemmed	Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning
title_sort	malaysian multinational companies (mnc): permanent and temporary nature of tax planning
publisher	Taylor & Francis Group
publishDate	2016
url	https://doaj.org/article/b253a23266484b5d8f7756ae52271f7a
work_keys_str_mv	AT norshaipahabdulwahab malaysianmultinationalcompaniesmncpermanentandtemporarynatureoftaxplanning
_version_	1718391094282027008

Malaysian multinational companies (MNC): Permanent and temporary nature of tax planning

Ejemplares similares