The Impact Of CEO Duality On Corporate's Radical Tax Avoidance

Taxation is a financial means for a country to maintain its domestic market economic order.However,due to the motivation of reducing tax burden,there are widespread tax avoidance practices in the corporates.The prevalence of tax avoidance has made the study of the factors influencing tax avoidance become a crucial topic in the field of tax avoidance theory.With the gradual development of the economy and the gradual improvement of the market,the research on the theory of tax avoidance in our country is gradually enriched.Under the background of the separation of ownership and management rights of modern company-based companies,the corporate leadership conducts daily strategic decision-making and business management of the company,that is,business leaders have an important influence on the economic decision-making and economic behavior of the company.The tax avoidance strategy of enterprises belongs to the scope of daily business decision-making.It is the result of the manager's comprehensive consideration of multiple factors such as tax avoidance benefits,costs and risks.Therefore,senior management is a key factor affecting corporate tax avoidance,and the leadership structure formed by the two positions of chairman and general manager will also have an important impact on corporate tax avoidance decisions.Because of the uncertainty of tax avoidance benefits and tax avoidance risks,and it often requires multiple coordination,there are also certain differences in corporate tax avoidance behavior under different leadership structures.There are many literatures on tax avoidance behavior based on the Chinese background,but most of them focus on the economic consequences of tax avoidance.There are few studies on the effect of corporate governance mechanisms on corporate tax avoidance,especially the paper discussing this behavior based on the decision-making perspective of management's weighing of tax avoidance risks and benefits.Therefore,it is of great significance to study the influence of leadership structure factors on corporate tax avoidance behaviors based on the perspective of management.It can not only explore the best corporate governance mechanisms,but also enrich the research on the factors that influence corporate tax avoidance.In this paper,we uses a combination of normative and empirical research methods,examining the impact of the CEO duality on corporate radical tax avoidance,by taking the A-share of non-financial listed companies from 2008 to 2016 in Shanghai and Shenzhen Stock exchanges as samples.Empirical results show that the CEO duality can significantly reduce the company's radical tax avoidance behavior.Further tests found that the weakening effect of the CEO duality on non-state-owned companies' radical tax avoidance behavior is greater.And the greater the intensity of tax collection and management,the greater the negative impact of the CEO duality on the companies' radical tax avoidance behavior.Similarly,the better the legal environment in which the company is located,the more significant the effect of reducing the degree of radical avoidance.In addition,the higher the environmental uncertainty faced by the company,the more it can reduce its radical avoidance.What's more,the higher the proportion of institutional investors in the company,the more the weakening of the CEO duality to reduce the company's radical tax avoidance.Finally,we found that if the company changed from duality into separation,it will significantly increase the company's radical tax avoidance,while separation into duality will significantly reduce the company's radical tax avoidance.This paper enriches the research literature aboutthe influencing factors of the company's radical tax avoidance and the economic consequences of the CEO duality.