특수관계자 거래를 통한 보고이익의 변동이 조세회피에 미치는 영향에 관한 연구: 비정상 특수관계자 거래를 중심으로

Abstract

In a recent study, Kim et al.(2015) examine the relation between abnormal related party transactions and corporate tax avoidance. The authors find an insignificant association between corporate tax avoidance and abnormal related party transactions, which is defined as the absolute value of the difference between estimated and actual related party transactions. They interpret their results as an evidence that suggests the effectiveness of Korean Corporate Income Tax Law in prohibiting tax avoidance activities through the related party transactions. However, their study is limited in that it does not take into account the income increasing (or decreasing) effect of related party transactions on tax avoidance behavior. Related party transactions may increase or decrease a firm’s reported earnings depending on the management intention. This, in turn, may affect the firm’s incentive to engage in corporate tax avoidance activities associated with related party transactions. Therefore, in addition to the variable of abnormal related party transactions, we add a dichotomous dummy variable, which represents income-increasing or income-decreasing effect of related party transactions, to the empirical model examining the effect of abnormal related party transactions on corporate tax avoidance. The empirical results show that abnormal related party transactions are insignificantly associated with tax avoidance. In addition, we do not find significant relation between directional effect on reported earnings of related party transactions and tax avoidance. These results suggest that firms do not engage in corporate tax avoidance activities through related party transactions, regardless of the directional effect on reported earnings of related party transactions, presumably because Korean taxing system based on Korea Corporate Income Tax Law effectively limits corporate tax avoidance activities, which, in part, might be attempted through related party transactions.

In a recent study, Kim et al.(2015) examine the relation between abnormal related party transactions and corporate tax avoidance. The authors find an insignificant association between corporate tax avoidance and abnormal related party transactions, which is defined as the absolute value of the difference between estimated and actual related party transactions. They interpret their results as an evidence that suggests the effectiveness of Korean Corporate Income Tax Law in prohibiting tax avoidance activities through the related party transactions. However, their study is limited in that it does not take into account the income increasing (or decreasing) effect of related party transactions on tax avoidance behavior. Related party transactions may increase or decrease a firm’s reported earnings depending on the management intention. This, in turn, may affect the firm’s incentive to engage in corporate tax avoidance activities associated with related party transactions. Therefore, in addition to the variable of abnormal related party transactions, we add a dichotomous dummy variable, which represents income-increasing or income-decreasing effect of related party transactions, to the empirical model examining the effect of abnormal related party transactions on corporate tax avoidance. The empirical results show that abnormal related party transactions are insignificantly associated with tax avoidance. In addition, we do not find significant relation between directional effect on reported earnings of related party transactions and tax avoidance. These results suggest that firms do not engage in corporate tax avoidance activities through related party transactions, regardless of the directional effect on reported earnings of related party transactions, presumably because Korean taxing system based on Korea Corporate Income Tax Law effectively limits corporate tax avoidance activities, which, in part, might be attempted through related party transactions.