Tax Evasion Investors Protection and Corporate Governance
17 pages
English

Tax Evasion Investors Protection and Corporate Governance

-

Obtenez un accès à la bibliothèque pour le consulter en ligne
En savoir plus
17 pages
English
Obtenez un accès à la bibliothèque pour le consulter en ligne
En savoir plus

Description

Tax Evasion, Investors Protection and Corporate Governance. Kirsten Ralf? Jean-Bernard Chatelain† May 28, 2004 Abstract When limiting the extent of the hidden economy, tax inspection may be a substitute to private monitoring of investment projects. When enforcing in- vestors protection, the judiciary system is a complement to private governance as it decreases private monitoring costs. Corporate income tax may finance government expenditures related to tax inspectors limiting the hidden economy and to the judiciary system enforcing investors protection. However, a corpo- rate income tax increase enhance tax evasion. This paper provides the range of relevant value for the corporate tax rate which provides incentives for private monitoring leading to an increase of the number of projects which are financed, with a higher share of external funds. JEL classification number: O16. Keywords: Tax evasion, Investor Protection, Monitoring, Investment 1. Introduction International organizations such as the IMF, the world bank and the OECD as well as leading academics in Chicago and Harvard Universities expressed their concern with respect to the governance of firms and states, corruption and the impact of institutions related to the legal system on the economic performance of several countries in the last decade. Corruption, the lack of investor protection and tax evasion are striking features of economies in transition (Anderson and Kegels [1998], Berkovitz and Li [2000], Johnson et al.

  • private investors

  • monitoring

  • corporate income

  • private governance

  • tax evasion

  • uninformed investors

  • income tax

  • outside investors

  • when limiting

  • capital can


Sujets

Informations

Publié par
Nombre de lectures 72
Langue English

Exrait

TaxEvasion,InvestorsProtectionandCorporateGovernance.KirstenRalfJean-BernardChatelainMay28,2004AbstractWhenlimitingtheextentofthehiddeneconomy,taxinspectionmaybeasubstitutetoprivatemonitoringofinvestmentprojects.Whenenforcingin-vestorsprotection,thejudiciarysystemisacomplementtoprivategovernanceasitdecreasesprivatemonitoringcosts.Corporateincometaxmaynancegovernmentexpendituresrelatedtotaxinspectorslimitingthehiddeneconomyandtothejudiciarysystemenforcinginvestorsprotection.However,acorpo-rateincometaxincreaseenhancetaxevasion.Thispaperprovidestherangeofrelevantvalueforthecorporatetaxratewhichprovidesincentivesforprivatemonitoringleadingtoanincreaseofthenumberofprojectswhicharenanced,withahighershareofexternalfunds.JELclassicationnumber:O16.Keywords:Taxevasion,InvestorProtection,Monitoring,Investment1.IntroductionInternationalorganizationssuchastheIMF,theworldbankandtheOECDaswellasleadingacademicsinChicagoandHarvardUniversitiesexpressedtheirconcernwithrespecttothegovernanceofrmsandstates,corruptionandtheimpactofinstitutionsrelatedtothelegalsystemontheeconomicperformanceofseveralcountriesinthelastdecade.Corruption,thelackofinvestorprotectionandtaxevasionarestrikingfeaturesofeconomiesintransition(AndersonandKegels[1998],BerkovitzandLi[2000],Johnsonetal.[2000],HellmannandSchankerman[2000],Robinson[2001],RolandandVerdier[2003],Savaanetal.[2001]).Corruptionhasnegativeeectsondevelopmentthroughthemisallocationofactiv-ities(SchleiferandVishny[1993],Mauro[1995and1998],,Bardhan[1997],AcemogluTheAmericanUniversityofParis,147,ruedeGrenelle,75007Paris,e-mail:Ralfkirsten@aol.comUniversityofOrleans,LEO,e-mail:jean-bernard.chatelain@univ-orleans.fr
  • Accueil Accueil
  • Univers Univers
  • Ebooks Ebooks
  • Livres audio Livres audio
  • Presse Presse
  • BD BD
  • Documents Documents