Financing Constraints,institutional Investors' Shareholding And Corporate Tax Avoidance-

The financing problem has always been the focus of the financial aspect of the enterprise.The production and operation of the enterprise are closely related to the financing.There are asymmetric information and agency problems between the supply and demand of capital in the capital market.Therefore,it is not a simple thing for an enterprise to obtain the required capital from the capital market.In the process of external financing,it is often faced with many limitations and costs.It is inevitable to face the high cost of external financing and widespread financing constraints.Since the reform and opening up,small and medium-sized enterprises have played an important role in increasing employment rate,promoting the development of science and technology,and promoting the stable development of economy.According to the statistical data of China Statistical Yearbook,in terms of the number of enterprises,SMEs account for more than 90% of the total number of enterprises in the country;in terms of employment,SMEs provide more than 80% of urban jobs;in terms of providing fiscal revenue,SMEs create 60% of the total GDP of the country and contribute more than 50% to tax revenue.Small and medium-sized enterprises are important promoters in solving the employment problem,promoting the development of science and technology and increasing the national financial revenue.However,small and medium-sized enterprises in China are generally faced with financing difficulties.Small and medium-sized enterprises mainly rely on bank loans for financing.In China's financial system,banks are in a monopoly position,and there is no way for banks to obtain detailed information of enterprises,which makes it difficult for banks to accurately evaluate and judge enterprises.In addition,small and medium-sized enterprises generally have small business scale,poor management level,the products they produce do not need to adopt any technology,limited development,low profits,and are easily affected by other factors.Banks and other financial institutions regard them as risks,so China's small and medium-sized enterprises generally face the problems of financing difficulties and expensive financing.Corporate tax avoidance has been favored by scholars at home and abroad,and has become one of the hot topics.In recent years,scholars have done a lot of research on corporate tax avoidance,a large number of studies show that there are two sources of corporate tax avoidance,namely,information asymmetry and agency issues.In addition,one of the hindsight performance of tax avoidance behavior is that it can save cash flow expenditure.Sufficient cash flow is the guarantee of enterprisedevelopment.Sufficient cash flow inside the enterprise can meet the financing demand of the enterprise.For small and medium-sized enterprises in the credit market,it is very valuable to have sufficient cash flow inside.Due to the saving of cash flow brought by tax avoidance,it is worth considering whether the financing constraint enterprises will take this behavior.With the passage of time,institutional investors continue to mature.With the rapid development of all kinds of institutional investors,the proportion of holding shares of listed companies is also growing gradually.The government has also introduced relevant laws and policies to help institutional investors to hold shares.Because institutional investors have professional ability in information mining and interpretation and high participation motivation in corporate governance,they can effectively alleviate information asymmetry and agency problems,thus reducing the degree of financing constraints.Based on the existing research results at home and abroad,this paper tests the relationship between financing constraints and corporate tax avoidance with the sample data of SME listed companies in 2008-2017.On this basis,it further tests the impact of institutional investors' shareholding number and heterogeneity on the relationship between financing constraints and corporate tax avoidance.The empirical results show that: first,the greater the financial constraints faced by enterprises,the stronger the degree of tax avoidance;second,the higher the proportion of institutional investors holding shares,which has a significant inhibition on the positive correlation between financial constraints and corporate tax avoidance;third,the long-term holding of institutional investors,which has a significant inhibition on the positive correlation between financial constraints and corporate tax avoidance.The conclusion of this paper can provide reference for how to solve the problem of Financing Restriction of small and medium-sized enterprises,strengthen the government's tax collection and management,and perfect the supervision mechanism of tax collection.Small and medium-sized enterprises are unable to obtain funds through traditional financing channels.In order to grasp favorable investment opportunities,they plan to take tax avoidance actions to ease the financing constraints they face.Therefore,they should expand financing paths,try their best to cultivate small and medium-sized financial institutions,further expand "tax bank linkage",build a bridge between small and medium-sized enterprises and financial institutions,realize tax credit information sharing,and set up a wide range for small and medium-sized enterprises A slow and fair financing environment is very important.Institutional investors play a role in guiding and supervising the disclosure of information mining,which helps to alleviate the degree of information asymmetry,ease the financing constraints faced by SMEs,and reduce the degree of tax avoidance of SMEs.And the more stable long-term institutional investors,the stronger the role of supervision and governance of SMEs.To promote the development of institutional investors and cultivate the long-term investment concept of institutional investors can restrict the tax avoidance behavior of enterprises to a certain extent.