On The Relationship Between Managerial Stock-based Incentives And Corporate Income Tax Avoidance Of State-owned Company

This paper focuses on the prominent question of domestic and foreign tax evasionand avoidance, through the theory of stock-option incentives we has established thetheoretical model about the relation between the degree of corporate income tax avoidanceand management stock-option incentives, and had proven the conclusion accuracy byusing empirical methods. In the foundation of reviewing the domestic and foreign relatedliteratures, we start to explore with the question whether high quota managementincentives can actually cause the corporate income tax avoidance behavior to be worse.This article comparatively analysis the definitions of tax evasion and avoidance, andintroduces the theory of stock-option incentives and management rent seeking theory toestablish the theoretical model. Then we became to define these important variables, suchas the degree of tax avoidance, management stock-option incentives, and the managementpower, as well as some controlled variables, and established a regression model about thedegree of tax avoidance with independent variables.The main topic of this paper is: how to measure the extent of corporate tax avoidanceindicators? How to design a relational model of corporate tax avoidance and managementequity incentive? The state-controlled listed companies management equity incentive leveldegree of corporate income tax to avoid will cause what impact? In this paper, severalconclusions: First, the management equity incentive levels showed a significant positivecorrelation evade taxes degree of relationship between. Given more stock-optionincentives, the management’s interest would converge more with the all shareholders. Torealize the shareholder’s value maximization, the management will achieve this goalthrough the avoiding taxes. Third, there are positive relationships between the variables.Finally, if there is more incentive, relative to the private listed companies, state-ownedholding listed companies will not take more corporate tax avoidance.