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Anti‐Corruption and Corporate Tax Burden: Evidence from China

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Listed:
  • Yunsen Chen
  • Dengjin Zheng
  • Peixin Li
  • Weimin Wang

Abstract

We examine whether the Chinese government's anti‐corruption enforcement reduces corporate tax burdens. Using a difference‐in‐difference approach, we find tax burdens of firms located in corrupt political leaders’ jurisdictions are lower after these leaders were deposed. An analysis of two tax policy changes shows that the reduction in tax burden is more pronounced when corrupt politicians had more power in levying taxes.

Suggested Citation

  • Yunsen Chen & Dengjin Zheng & Peixin Li & Weimin Wang, 2020. "Anti‐Corruption and Corporate Tax Burden: Evidence from China," International Review of Finance, International Review of Finance Ltd., vol. 20(3), pages 781-788, September.
    • Handle: RePEc:bla:irvfin:v:20:y:2020:i:3:p:781-788
    DOI: 10.1111/irfi.12226
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    References listed on IDEAS

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    Cited by:

    1. Adamu Jibir & Musa Abdu & Tasiu Muhammad, 2020. "Analysis of Tax Compliance in Sub-Saharan Africa: Evidence from Firm-Level Study," Econometric Research in Finance, SGH Warsaw School of Economics, Collegium of Economic Analysis, vol. 5(2), pages 119-142, December.
    2. Tom Moerenhout & Joonseok Yang, 2022. "Tax Evasion Attitudes of Small Firms in Low‐ and Middle‐income Countries: Evidence from Nigeria," Development Policy Review, Overseas Development Institute, vol. 40(6), November.

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