Examining the role of the quality of corporate governance and government governance on tax avoidance

Abstract

Good governance is a way to use in the management of various resources and economies for the development of the society, as well as the exercise of authority to manage various affairs in the administration of the country in terms of politics, economics and administration at all levels. Good governance can be in several areas including corporate governance, international governance, national governance and local governance. Several studies showed that good corporate governance has a significant effect on the level of tax avoidance of companies, so that it minimizes the amount of tax violence and increases the tax revenue of the government. In order to verify the correctness of this claim, in the present study, the effect of the quality of corporate governance as an element of internal control and the quality of government governance as an element of external control on tax avoidance was investigated. For this purpose, the information of 103 companies admitted to the Tehran Stock Exchange during the period of 2012 to 2018 was examined. The results of the survey showed that the quality of corporate governance does not have a significant effect on tax avoidance, while the quality of public governance has a negative and significant effect on tax avoidance.