This study analyze the effect of the disclosure of information arising from the obligation to submit an integrated report introduced according to the BEPS project on the tax avoidance tendancy of the company. In order to analyze the policy effect after introducing the system of a company to submit an integrated report, it is verified by using the difference in differences method.

From 2012 to 2019, 6,556 multinational corporations (company×year) among KOSPI and KOSDAQ listed companies were analyzed. As a result of analysis, for companies obligated to submit national reports, the policy effect after the introduction of the system was not statistically significant. And the obligation to submit integrated/individual company reports showed a tendency to lower tax avoidance. As a result of the analysis by year, the policy effect was not verified for the compulsory companies for submitting national reports. Companies that have been required to submit integrated and individual company reports have generally had a taxes avoidance tendency to lower compared to control groups since 2017. For companies that are obliged to submit a country-specific report, the effect of the increase in the level of information disclosure due to the submission of the integrated report has little effect on tax avoidance tendency. However, companies that are obligated to submit integrated/individual company reports can confirm that the submission of integrated reports has had a certain effect on tax avoidance tendency.

This study verified the policy effect of the introduction of Action13 among BEPS projects through empirical analysis in an effort to prevent tax avoidance by multinational companies due to international diversification. This study confirmed the effect of the company’s obligation to submit information due to the information asymmetry between the tax authorities and the company on actual tax avoidance tendency.

▶ Key Words： multinational enterprise, tax avoidance, BEPS project, Action13, country by country reports

** Published on September 2020
** Full article available in Korean only
** Download here → 22-9 Relationship between Multinational Corporations' Information Disclosure and Tax Evasion.pdf