Tax evasion, firm’s value and governance: evidence from Tunisian Stock Exchange

Abstract

Purpose

The purpose of this study is to analyze the relationship between tax evasion and firm’s value while determining the moderating role of family management and the ownership’s concentration in this relationship.

Design/methodology/approach

The empirical study employs a Panel Data set of 34 firms listed on the Tunisian Stock Exchange (TSE) for the period 2007 to 2014. Regression analysis is used to estimate the relationships proposed in the hypotheses.

Findings

The results show that tax evasion has no direct effect on a firm’s value. This study highlighted the presence of a moderating effect of family management on the relationship between tax evasion and firm’s value. However, no moderating effect of the concentration of property on the mentioned relationship was detected.

Originality/value

This study represents a first empirical essay focusing on the relationship between tax evasion and firm’s value. Furthermore, it analyzes the moderating effect of some aspects of governance, such as family management and ownership’s structure, on this relationship in a Tunisian context.

Citation

Nafti, O., Kateb, I. and Masghouni, O. (2020), "Tax evasion, firm’s value and governance: evidence from Tunisian Stock Exchange", Journal of Financial Crime, Vol. 27 No. 3, pp. 781-799. https://doi.org/10.1108/JFC-02-2020-0023