Aggressive Tax Planning and Corporate Tax Avoidance: The Case Study

  • Adzhar Sulaiman Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia
  • Kamil Md. Idris Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia
  • Saliza Abdul Aziz Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia
Keywords: Tax avoidance, corporate restructuring, tax intermediaries

Abstract

There have been increasing literature on aggressive tax planning and corporate tax avoidance, which focus on economic consequences (Ksovreli, 2015; Hanlon & Heitzman, 2010). Campaigners have targeted tax-avoiding corporations through the media, citing the enormous amount of tax losses (Hasseldine, Holland & Van der Rijt, 2012). It is pertinent that policy-makers and tax authorities to take action against tax avoiders and tax intermediaries. This paper focuses on the tax avoidance structures identified during tax audits and investigations and further contributes to an understanding of tax avoidance structures and models. The key models identified are related to the abuse of tax incentives and the use of corporate restructuring to minimize or reduced tax exposures. Based on the Case Management System of the Inland Revenue Board of Malaysia, we identify the key structures, their roles and incentives, and outline the tax avoidance schemes. The study summarizes a range of policy responses to tax avoidance, including anti-avoidance rules, disclosure rules and the regulation of tax intermediaries such as tax practitioners.

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Published
2019-04-01
How to Cite
Sulaiman, A., Md. Idris, K., & Abdul Aziz, S. (2019). Aggressive Tax Planning and Corporate Tax Avoidance: The Case Study. Indian-Pacific Journal of Accounting and Finance, 3(2), 27-38. https://doi.org/10.32890/ipjaf.2019.3.2.71
Section
Main Section