재무적 곤경이 (다국적)기업의 조세회피행위에 미치는 영향

Firms and managers are likely to have incentives to minimize taxes. Due to tax avoidance and tax evasion, the difference between ‘tax payments received’ and ‘the tax actually billed to the tax payer’ is estimated to be 20% across developing countries. It is universally accepted that tax avoidance refers to legal tax planning and tax evasion refers to illegal tax planning. Tax avoidance is broadly defined as the reduction of explicit taxes. However, it is blurry to distinguish between technically legal tax avoidance and illegal tax evasion. Due to the difficulty of conceptually defining tax avoidance or tax evasion, different terms such as ‘tax shelter’, ‘tax noncompliance’, and ‘aggressive tax strategy’ are also used to describe the behavior of explicit tax reduction. Prior literature examines a wide range of determinants of firms’ tax avoidance behavior. It is particular interest to examine an increase of tax avoidance behavior when firms are faced with financial constraints. Cash tax planning is unlikely to adversely effect the firm’s long-term performance, financially constrained firms are anticipated to have preference for reducing taxes rather than other cost saving techniques. In this study, the association between financial distress (at both the macroeconomic and firm-specific level) and corporate tax avoidance in Korea is investigated using KOSPI data from 1999 to 2014. Firms under financial distress may increasingly take action to avoid taxes if the benefits of tax avoidance outweigh the costs. Therefore, the present study proposes two main hypotheses. First, it is hypothesized that financially distressed firms will be motivated to increase tax avoidance activities to reduce tax costs, and therefore, financial distress is likely to be positively associated with corporate tax avoidance. Second, it is hypothesized that the recent global financial crisis (GFC) influenced corporate tax avoidance by either magnifying or mitigating it. Two sub-hypotheses are proposed for the second hypothesis. These sub-hypotheses are designed to ascertain the tax avoidance implications for (1) financially distressed firms during the GFC and (2) firms having operations in countries regarded as tax havens (or quasi tax havens) during the GFC. In the research model, the dependent variable is represented by corporate tax avoidance, which is measured using the book-tax difference residual based on the method developed by Desai and Dharmapala (2006). As proxies for financial distress, three variables are employed. The three proxies for financial distress are the change in gross domestic product for macroeconomic financial distress, the modified Altman Z-score (1998), and the Whited-Wu financial constraint index (2006) for firm-level financial distress. The regression results for the first hypothesis are consistent with prior literature. A significant positive association is found between financial distress and corporate tax avoidance. These results imply that as financial distress increases, firms may be more willing to pursue aggressive tax avoidance behavior when marginal benefits exceed marginal costs. The second hypothesis is also analyzed to determine whether the GFC of 2008 affected tax avoidance. According to a report from AK EUROPA, the Brussels Office of the Austrian Federal Chamber of Labour, the GFC contributed to tax evasion and massive tax shortfalls. This created a 28% increase in offshore wealth just in the six-year period between 2008 and 2013. However, the result for this study’s second hypothesis is not consistent with prior research findings. A decrease in tax avoidance is observed in the post GFC period. This result seems to be exceptional, and it is attributed to a group of tax systems introduced in Korea in the mid-2000s designed to broaden the tax base. This implies that individual Korean tax systems such as the Cash Receipt System (2005), Self-billing Tax Invoice System (2007), and Electronic Tax Invoice System (2011) appear to be effective. Firms with greater financial distress exhibited a smaller tendency to reduce tax avoidance behavior after the GFC. Meanwhile, multinational companies operating in tax havens (or quasi tax havens) also showed a smaller tendency to reduce tax avoidance behavior compared to domestic-only firms in the post GFC period. Tax haven is defined as a jurisdiction that imposes no or only nominal taxes and offers itself as a place to be used by non-residents to escape taxes in their country of residence. This result is noteworthy, as it may imply that firms with foreign operations have more opportunities to avoid taxes than domestic-only firms. Recently, the G20, through the Organization for Economic Cooperation and Development (OECD), has embarked on a journey to prevent base erosion and profit sharing (BEPS). Firms need to perceive the increased risk of tax evasion and take action to comply with a rapidly changing international tax system, and they need to consider ways in which to conduct business in different countries. Additional testing is carried out to determine whether firms having operations in tax havens under financial constraints during the GFC showed a smaller tendency in terms of reducing tax aggressiveness. The results are not significant. Overall, this study provides unique empirical evidence and contributes to the literature on tax avoidance by investigating the impact of financial distress with respect to macroeconomic factors, firm-specific levels, and the GFC.