Proceedings of The 11th International Conference on Modern Research in Management, Economics and Accounting
Year: 2020
DOI: https://www.doi.org/10.33422/11th.meaconf.2020.12.82
The Association between Corporate Social Responsibility Disclosure and Tax Avoidance: Evidence from Philippines
Eko Budi Santoso, Kezia Laturette, and Stanislaus Adnanto Mastan
ABSTRACT:
Social responsibility is an interesting topic, as it plays an important part in a company’s strategy to increase its value in the eyes of its investors. By increasing its awareness on social responsibility, corporate has disclosed responsible activities to receive a recognition as an ethically responsible company in its business practices. However, some researches conducted in developing countries show that social responsibility disclosure can act as a tool to deceive corporate financial fraud behaviour. Thus, this study aims to examine whether companies that actively disclose their social responsibility also behave ethically in their financial aspects. Specifically, this study investigates whether companies with good social responsibility also behave responsibly in the aspect of taxation by reducing the rate of tax avoidance practices. The sample group includes go public companies listed in the Philippine stock exchange during the period of 2014-2019 that published sustainability reporting. The results of this study show that corporate social responsibility has a negative association with tax avoidance.
Keywords: CSR disclosure, tax aggressiveness, business ethics.