Corporate Governance and Tax Compliance

• Author(s): Bello, Muhammed Akinkunmi
• Paper ID: 1704542
• Page: 864-873
• Published Date: 31-05-2023
• Published In: Iconic Research And Engineering Journals
• Publisher: IRE Journals
• e-ISSN: 2456-8880
• Volume/Issue: Volume 6 Issue 11 May-2023

Abstract

The study examines the effect of corporate governance and tax compliance in corporate sector. The interfaces of corporate governance with tax compliance are mutual and strongly exclusive. Therefore, the objective of this study is to analyze the link between corporate governance and tax compliance, studying how corporate governance rules can reach a higher level of corporate compliance with the tax system. As partly explained, the structural arrangement of corporate governance rules affects the manner corporate tax obligations are fulfilled; whereas the other part, explains the way tax designs is designed by the government and how the related tax strategies adopted by the corporation as planned influences corporate governance dynamics. This work demonstrates that the characteristics of a taxation system underline the magnitude of benefits accruable to managers adopting an opaque transaction style in a business environment with weak corporate governance without the knowledge of the investors. As well as how robust corporate governance practices prevent frolics from the controlling manager. A higher tax rate increases the amount of income a manager would divert, while stronger tax enforcement reduces it and, in so doing, can raise the stock market value of a company in spite of the increase in the tax burden. The study recommended that stakeholders should be conscious of the tax strategy that encourage tax avoidance in their assessment of the risks of investment and that government should endeavor to make the tax regulations less cumbersome to reduce tax loopholes with emphasis on strong corporate governance in order to have a reliable report that illustrates the actual investment.

Keywords

Corporate Governance, Tax Compliance, Tax Avoidance, Stakeholders

Citations

IRE Journals:
Bello, Muhammed Akinkunmi "Corporate Governance and Tax Compliance" Iconic Research And Engineering Journals Volume 6 Issue 11 2023 Page 864-873

IEEE:
Bello, Muhammed Akinkunmi "Corporate Governance and Tax Compliance" Iconic Research And Engineering Journals, 6(11)