U.S. Multinational Corporations, Tax Avoidance, and Multiple Earnings Goals

• In Event: Tax Avoidance

Abstract

I hypothesize and find that U.S. multinational corporations (MNCs) tend to apply aggressive tax planning to meet/beat multiple earnings benchmarks (MMB). Specifically, as MNCs MMB, they do not apply as much other earnings management methods as non-MNCs, but they do exhibit significant evidence of tax avoidance with much lower effective tax rates.

Author

• Jason Jiao, Bradley University