Banking deregulation and corporate tax avoidance

Banking deregulation and corporate tax avoidance

Blog Article

We investigate whether tax avoidance substitutes for external Briefs financing.We exploit interstate banking deregulation as a quasi-external shock to examine whether firms engage in less tax avoidance after banking deregulation, because of cheaper and Cat Wet easier access to credit from banks.We find no empirical evidence to support this substitutive relation, even for firms with higher financial constraints or firms with higher external financing dependence.