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Does green factory certification affect corporate tax compliance?

Author

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  • Fan, Xiao
  • Jiang, Jie
  • Na, Chaohong

Abstract

Exploiting the data of China’s A-share listed from 2009 to 2023, this study takes the green factory certification (GFC) policy as a quasi-natural experiment to investigate whether and how government-certified green transformation affects corporate tax compliance. The results show that GFC significantly improves corporate tax compliance. The underlying channels include the certification premium mechanism and the opportunism restraining mechanism. In addition, the certification effect is more pronounced among private firms, as well as firms with more subsidiaries, stronger financing constraints, and poorer disclosure quality. Overall, this study contributes to the literature by advancing our understanding of how green transformation influences firms’ strategic decision-making.

Suggested Citation

  • Fan, Xiao & Jiang, Jie & Na, Chaohong, 2026. "Does green factory certification affect corporate tax compliance?," Finance Research Letters, Elsevier, vol. 103(C).
    • Handle: RePEc:eee:finlet:v:103:y:2026:i:c:s1544612326006793
    DOI: 10.1016/j.frl.2026.110151
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    Keywords

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    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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