Recently, international renowned academic journal Accounting & Finance submitted the paper titled Saving or tunnelling: value effects of tax avoidance in Chinese listed local government-controlled firms, which was wrote by professor Wenzhou QU from our Department of Finance, SMXMU joint with associated professor Lihong WANG from Institute for Financial & Accounting Studies and PhD. Student Shaoqing KANG.
Abstract
This paper investigates the value effect of tax avoidance and its underlying mechanisms among Chinese listed local government - controlled (LG) firms. We show that tax avoidance does not promote firm value in LG firms with government ownership smaller than 40 percent and the above negative tunnelling effect is more pronounced when the control rights are concentrated in the local government and weaker when other large shareholders can act as a countervailing force. Finally, we observe a positive relation between tax avoidance and related‐party transactions as well as overinvestment, again indicating a tunnelling effect in LG firms with government ownership smaller than 40 percent.
Author
Wenzhou QU
Professor, Ph.D. supervisor, Director of MBA, SMXMU
Committee member of China Youth Federation,
New Century Outstanding Talents of the Ministry of Education
Fujian Outstanding Youth Medal Award
He is the reviewer of Economic Research, Management Science, Financial Research, Nankai Management Review, Finance Quarterly, China Financial Review. Prof. QU is undertaking numerous projects from National Natural Science Foundation of China, and has published dozens of academic papers in domestic authoritative journals as Economic Research, Management World, Management Science, Financial Research, ect. He had been achieved “Third Prize of China University Humanity and Social Science Research Outstanding Achievement”, “First Prize of Fujian Social Science Outstanding Achievement” and many research awards at national and provincial level.
Research Interest: Capital Market Theory, Corporate Finance, Mergers and Acquisitions, Stock Investment, etc.
