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Institutional environment, inside ownership and effective tax rate

Tao Zeng (Wilfrid Laurier University, Waterloo, Canada)

Nankai Business Review International

ISSN: 2040-8749

Article publication date: 4 October 2011




The purpose of this paper is to examine the effect of institutional environment and inside ownership on the tax reporting practices of Chinese listed firms.


It is an empirical study using a sample of Chinese listed firms for eight years of time periods between 1998 and 2005.


This study finds that in Chinese provinces with more developed institutions, firms have higher effective tax rates; however, firms with inside ownership in these regions have lower effective tax rates. Further analysis shows that the above results hold only for non‐state‐owned firms.


The paper presents the first study of the impact of inside ownership and institutional environment on corporate effective tax rate in China.



Zeng, T. (2011), "Institutional environment, inside ownership and effective tax rate", Nankai Business Review International, Vol. 2 No. 4, pp. 348-357.



Emerald Group Publishing Limited

Copyright © 2011, Emerald Group Publishing Limited

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