Research On The Influence Of Director Network On Tax Evasion

In order to promote the realization of fair and efficient market,the state implements a larger scale of tax reduction and fee reduction and introduces various preferential tax policies in 2019.Corporate tax avoidance will lead to erosion of the country's tax base,reduce tax revenue,affect the country's income regulation,damage competition efficiency,and undermine social equity.Practical circles and regulatory agencies are paying more and more attention to the problem of tax avoidance of enterprises.The existing research has noticed the significant difference of tax evasion between private enterprises and state-owned enterprises,and shows that tax evasion behavior of private enterprises has seriously affected the realization of tax fairness in China.The board of directors is the most important decision-making and management organ in an enterprise.It must implement the decisions made by the shareholders'meeting.With the increase of the number of listed companies and the development of the board of directors system,more and more interlocking directors who hold directorship positions in different enterprises have emerged.The same directors in different enterprises have become the key to link up the relationship between enterprises,thus enterprises can better communicate and exchange experience and other information.Although the director network formed by the linlcage of chain directors can broaden the channels for enterprises to obtain information and ease the constraints of resources,at the same time,the rent-seeking behavior of chain directors through the director network,"busy directors" and the "insider" control phenomenon of the board of directors will damage the independence of directors and weaken the exertion of the supervisory function of directors.Therefore,this paper explores whether the network of director formed by chain directors in private listed companies will have an impact on corporate tax avoidance,and analyzes the mechanism of the impact.and explores whether there are differences in the impact of chain directors in different director network positions.In order to achieve the purpose of the study,based on the theoretical analysis,this paper focuses on two aspects.Firstly,whether the network of director formed by chain directors can explain the tax evasion behavior of enterprises to a certain extent.Secondly,whether the relationship between the network of director and the tax evasion behavior of enterprises is subject to directors' type,background of independent directors and the impact of institutional environment in the area where the enterprise is located or not.Based on previous research findings and related theoretical models,this paper uses PAJEK to process directors' data matrix and network analysis to get director network centrality data,and then uses STATA to carry out empirical analysis.The final conclusion is that director network damages the independence of chain directors,the board of directors and managers and controlling shareholders collude,using director network to obtain one.The more centralized the network is,the worse the independence of chain directors will be.The more radical tax avoidance enterprises take,that is.the higher the degree of director network centrality is.the more serious the tax avoidance of enterprises will be.The influence of network centrality of independent directors on tax evasion is stronger than that of non-independent directors,among which the independent directors with financial background play a key role.In non-tax preferential areas,the impact of director network on tax evasion is more significant.This paper finds that institutional environment can restrain the effect of director network on tax evasion.At the end of the study,possible further research is proposedThe innovations of this paper are as follows.Firstly,it distinguishes the influence of independent director network and non-independent director network on corporate tax evasion,and refines them into independent directors with financial background and independent directors with non-financial background at the level of independent directors,which broadens the research scope of director network.Secondly,it explores private listing from the dimension of director network.The influencing factors of corporate tax avoidance and the differences of director network in different tax preferential areas on the degree of corporate tax avoidance broaden the scope of research on tax avoidance,and innovatively explain the impact of government macro-control on corporate tax avoidance and social tax fairness.At present,governments at all levels in our country emphasize the purpose of improving the quality of government service by optimizing the institutional environment.This paper finds that the external institutional environment of enterprises will inhibit the promotion of director network to tax evasion.This result theoretically supports the scientific nature of government decision-making.