A BRIEF LITERATURE REVIEW ON THE PROXIES USED TO MEASURE THE CORPORATE INCOME TAX AVOIDANCE
A BRIEF LITERATURE REVIEW ON THE PROXIES USED TO MEASURE THE CORPORATE INCOME TAX AVOIDANCE

A BRIEF LITERATURE REVIEW ON THE PROXIES USED TO MEASURE THE CORPORATE INCOME TAX AVOIDANCE

Author(s): Costel Istrate
Subject(s): Accounting - Business Administration
Published by: Editura Universităţii »Alexandru Ioan Cuza« din Iaşi
Keywords: corporate income tax; tax avoidance/tax evasion; book-tax differences; effective tax rate.
Summary/Abstract: In developed countries, corporate income tax (CIT) represents an important source of revenues to public budgets: in 2020, CIT brought to the budgets about 2.4% reported to the GDP. CIT was and still is one of the most appropriate taxes in terms of the possibilities to reduce the amounts paid, to report figures that say nothing to the less initiated in sophisticated financial reporting techniques. Otherwise, we would not see a series of international, regional and national regulations trying to limit the proportion of the tax avoidance (TA) or of the tax evasion (TE). The definition of TA/TE is not achieved uniformly in regulations or literature. Following Hanlon & Heitzman (2010), I aim to identify in the literature definitions of TA, its forms, as well as indicators by which it can be measured.In the study, I will address the definition and characterization of corporate income tax avoidance, then I will focus on the variables used in literature to measure or estimate corporate income tax avoidance, on the financial or non-financial, microeconomic or macroeconomic indicators that influence TA, but also on those on which TA has effects.

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