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This study aims to enhance the understanding of the impact of the COVID-19 pandemic on corporate tax performance in the context of a large emerging country like Indonesia.

This study uses a quantitative approach with multiple regression methods on a data set of 2,366 firm-year observations registered on the Indonesia Stock Exchange (IDX) from 2017 to 2022.

The primary empirical findings from the multivariate regressions suggest a positive and significant association between the COVID-19 pandemic and corporate tax performance in Indonesia. In other words, these listed firms have increased their tax avoidance activities during the pandemic. As firms face financial hardships due to the pandemic's effects, they tend to engage in tax avoidance practices to reduce current income tax payments, thereby enhancing their liquidity. In addition, over time, firms have adapted to use various tax policies introduced by the government in response to the pandemic to mitigate the adverse impacts of the crisis.

This study draws on a sample solely from one emerging country.

The results of this study can aid governments, policymakers, tax authorities and companies in evaluating their strategies concerning preparedness and emergency responses during crises, particularly those caused by pandemics.

To the best of the author’s knowledge, this study is considered one of the initial efforts to examine the impact of the COVID-19 pandemic on corporate tax avoidance in an emerging country like Indonesia.

The Tax Cuts and Jobs Act of 2017 (TCJA) substantially lowered the corporate tax rate, making tax-exempt municipal bond issues less attractive investments for banks, savings and loan associations and insurance companies. To provide a benefit for small issuers the current Internal Revenue Code has a special provision that allows banks and S&Ls to deduct 80% of the borrowing costs for “bank-qualified” bonds – tax-exempt bonds from issuers who issue no more than $10 million in bonds during a year. This study examines whether the relationship between the true interest cost (TIC) on bank-qualified bonds and other tax-exempt bonds changed with the passage of the TCJA.

Using linear regression analysis this paper compares the TIC of bank-qualified bonds with the TIC of bonds not bank-qualified using a sample of bonds both before and after the passage of TCJA.

Prior to the passage of the TCJA, this study observes that these “bank-qualified” bond issues had a lower true interest cost than other tax-exempt bond issues; however, after passage of the TCJA, the difference in the true interest cost between “bank-qualified” bond issues and other tax-exempt bond issues dramatically decreased.

It appears that the benefit for small bond issuers is greatly reduced after corporate tax rates were significantly lowered. If federal lawmakers wish small issuers to have the same advantage over other tax-exempt municipal bond issuers after passage of TCJA, some changes will need to be made to the Internal Revenue Code to give small issuers an additional advantage when issuing tax-exempt debt.

No other empirical research to date has examined the impact of TCJA on bank-qualified bond issue interest cost.

This study examines the effect of board characteristics on the tax aggressiveness of listed companies on the Colombo Stock Exchange in Sri Lanka.

The sample consists of 264 firm-year observations of non-financial listed companies in Sri Lanka from 2014 to 2019. The dynamic panel system GMM technique was used to test the hypotheses, and further analyses were performed using the propensity score matching technique.

All four effective tax rate measures' mean values were lower than the statutory tax rate, indicating the likelihood of tax planning. Whether board attributes are likely to mitigate tax aggressiveness is uncertain because the results are inconsistent and depend on the ETR measure. Similarly, the logistic regression results derived using the PSM approach are inconsistent, suggesting that board characteristics may have a limited effect on tax aggressiveness. Hence, the corporate governance-tax aggressiveness nexus is limited in the case of Sri Lanka.

This investigation is limited to non-financial listed companies in Sri Lanka and incorporates only four tax aggressiveness measures. Findings are imperative for policymakers, regulators, and professional bodies to improve corporate governance codes and rules to enhance organisational transparency toward corporate tax payments.

Aggressive tax planning by companies will reduce government tax revenue, hinder social progress, and cause public mistrust of large corporations and institutions.

This study provides insight into the nexus between corporate governance and tax aggressiveness in a middle-income economy in South Asia hit by an economic crisis where tax revenue has fallen and tax enforcement is weak.

As a response to challenges that globalization poses, governments often utilize an expansionary fiscal policy, a mix of increased compensation spending and capital tax cuts. To account for these policy measures that are consistent with neither the compensation nor the efficiency hypothesis, this study examines government fractionalization as the key conditional factor.

We test our hypothesis with a country-year data covering 24 OECD countries from 1980 to 2011. To examine how a single country juggles compensation spending and capital taxation policies jointly, we employ a research strategy that classifies governments into four categories based on their implementation of the two policies and examine the link between imports and fiscal policy choices conditioned on government fractionalization.

This study shows that highly fractionalized governments are more likely to implement an expansionary fiscal policy than marginally fractionalized governments as a policy response to economic globalization and import shock.

Our findings imply that fractionalized governments are likely to face budget deficits and debt crises, as the expansionary fiscal policy persists over time.

By examining government fractionalization as one of the critical factors that constrain the fiscal policy choice, this study enhances our understanding of the relationship between economic globalization and compensation or efficiency policies. The arguments and findings in this study explain why governments utilize the seeming incompatible policy preferences over increased compensation spending and reduced capital tax burdens as a response to globalization, potentially subsuming both hypotheses.

Discourse concerning the most effective way for enterprises to offset environmental impacts is well established. While certain approaches like the Triple Bottom Line (TBL) have gained widespread acceptance, other initiatives like introducing the Carbon Tax in Australia have not been successful. This study examines the practical implementation of two environmental accounting models, the TBL and Carbon Tax, analysing their benefits and drawbacks and focusing on their application within the Australian accounting system. Using discourse and content analysis within two case studies of two different sectors – the banking sector (Westpac) and the manufacturing sector (BlueScope), this research contributes to the discourse concerning the implementation of such disclosures and how models such as the TBL and Carbon Tax initiative could be effectively used in practice. The results show that the implementation of the TBL was more widely adopted and seen as a positive factor in determining the company's environmental impact as viewed by investors. The Carbon Tax was initially adopted less frequently until modifications were made to allow for voluntary compliance. This was due to the misalignment of the cost of the tax with the financial priorities of each sector. Furthermore, the study suggests that a more comprehensive approach that leverages the strengths of both models to complement each other within an integrated framework may be the best solution for organisations seeking a more systemic approach to environmental disclosures and offsetting in their supply chain network.

The study aims to examine the dividend omissions and dividend cuts behaviour of manufacturing and non-financial services firms to identify the determinants of dividend omissions and dividend cuts.

The study analyses the financial data of 3,546 firms from 2011 to 2020 (35,460 firm-year observations) using a dynamic random-effect probit panel regression model.

The results suggest that profitability, growth opportunity, leverage, liquidity, risk, extraordinary income, shareholding pattern and buyback are major determinants of dividend omissions. Similarly, dividend cut in the previous year, profitability, operating cash flow, risk and extraordinary income are major factors leading to dividend cuts.

Firms which omit the dividend are less likely to start paying dividend in subsequent years, whereas firms which cut the dividend may increase dividend in later years. Also, profitability decreases for a significant number of firms post dividend omission and cut. This indicates that dividend omission is a more prominent signal than a dividend cut for the financial health of a firm.

The determinants identified in the study enable analysts and portfolio managers to decide the propensity of dividend omission and cut even before actual announcements and can alleviate the significant loss in the portfolio. Also, managers and the board of directors would be able to monitor the firm’s financial performance to avoid the situation leading to dividend omissions and cuts.

The study strongly recommends that firms should voluntarily pay dividends to shareholders to encourage the healthy participation of retail shareholders in the equity market and create a long-term win–win situation for all stakeholders in society. If a large number of firms continue not to pay the dividend, the study appeals to the regulators to intervene to protect shareholders' interests for the greater good of society.

To the best of author’s knowledge, this is the first study to empirically identify the determinants of dividend omission and cut in the unique setting like India where dividend taxation had undergone a significant change.

Tax evasion and money laundering have become important sources of illicit financial flows in developing countries. Foreign capital flows used by shell corporates are generally with no real economic activities but motivated by harmful tax practices, thereby inducing loss of revenue for developing countries. Despite the coercive actions, such as backlisting of noncooperative jurisdictions to anti-money laundering and countering terrorism financing standards, illicit financial activities are still eroding the tax base in developing countries. The purpose of the paper is to assess the blacklisting effectiveness as a coercive policy against illicit financial activities.

This paper applies a propensity score matching strategy to a sample of 118 developing jurisdictions from 2009 to 2017 to evaluate changes in illicit financial activities following the blacklisting.

The results show that rather than altering illicit inflows in blacklisted countries, financial restrictions have produced the inverse, causing a boomerang effect on financial crime activities. The illicit share of capital inflows increases on average by 6 percentage points and 0.7% of GDP following the blacklisting. These results are robust to alternative matching methods and to the hidden bias problem.

Most of the previous research analyzed the link between blacklisting and fiscal revenues. However, here, the study analyzes whether blacklisting makes countries more cooperative in terms of fighting illicit financial flows.

The theoretical basis for the case is information asymmetry and signaling theory, with buybacks providing a mechanism for reducing information asymmetry between management and investors. The controversy surrounding buybacks has led to political and regulatory scrutiny, which, consistent with evidence from academic research, may affect corporate behavior.

The compact case is based on secondary, public information about stock buybacks. All sources used are cited in-text, with full citations included in the references section at the end of the teaching note.

Stock buybacks, a means of providing returns to shareholders, have recently received increased scrutiny by politicians, media and shareholder activists. Proponents have argued that buybacks result in efficient allocation of capital by returning funds to shareholders, whereas opponents have criticized buybacks for enriching executives, providing tax advantages to shareholders and contributing to income inequality. Corporations did not curtail their use of buybacks after the Inflation Reduction Act of 2022 imposed an excise tax. The case frames the buyback debate in current events and focuses on the buyback activity of Apple. The case provides students the opportunity to analyze alternative ways that companies can provide returns to shareholders, evaluate impacts of buybacks on corporate stakeholders and appraise the reasons for, and implications of, current controversy regarding buybacks.

This compact case is appropriate for upper-level undergraduate or graduate courses in financial accounting, tax and finance. This case provides an opportunity to analyze and evaluate stock buyback decisions in the context of the current controversy related to buybacks.