Volume 19, Issue 3 (6-2014)
JPBUD 2014, 19(3): 173-190 |
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Pourheidari O, Amini Nia M, Fadavi M H. (2014). Investigating the Effect of Tax Avoidance on cost of equity, with considering growth opportunities and institutional ownership. JPBUD. 19(3), 173-190.
URL: http://jpbud.ir/article-1-861-en.html
URL: http://jpbud.ir/article-1-861-en.html
1- Shahid Bahonar University of Kerman , Opourheidari@uk.ac.ir
2- Shahid Bahonar University of Kerman
2- Shahid Bahonar University of Kerman
Abstract: (9022 Views)
The purpose of this study is investigating the effect of tax avoidance on the cost of equity firms listed in Tehran Stock Exchange. The study sample consists of 75 Firms listed in Tehran stock Exchange during the 2001 to 2010. Effective tax rate is used as measurement of tax avoidance. In order to testing the research hypothesizes, Ordinary Least Squares regression (OLS) and Panel Data have been used. The results showed that tax avoidance reduce cost of equity. In other word, firms by investing the cash from of tax avoidance, will increase future cash flow and thereby decrease cost of equity. It was expected that negative relationship between tax avoidance and cost of equity is stronger for firms with strong external monitoring and higher growth opportunities. But the results indicate that growth opportunities and institutional ownership don’t have significant effect on the relationship between tax avoidance and cost of equity.
Keywords: Tax Avoidance, Effective Tax Rate, Cost of Equity, growth opportunities, institutional ownership
Type of Study: Research |
Received: Jul 08 2013 | Accepted: Jun 10 2015 | ePublished: Jun 10 2015
Received: Jul 08 2013 | Accepted: Jun 10 2015 | ePublished: Jun 10 2015
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