Document Type : Research Paper
Authors
1
Department of management.Faculty of Management and Accounting, Rasht Branch, Islamic Azad University, Rasht, Iran
2
Associate Prof., Finance, Payame Noor University, Tehran, Iran
3
Department of management, Faculty of Management and Accounting, Rasht Branch, Islamic Azad University, Rasht, Iran
Abstract
Tax avoidance has always been one of the main concerns of governments. Today, many companies do tax avoidance activities with the aim of reducing taxable profits. On the other hand, managers of economic enterprises may show different behavioral biases, which can have short-term and long-term negative effects on various spectrums of users of financial statements, especially investors, creditors, and finally on society. For this purpose, the current research studies the effect of some of these behavioral biases, including Representativeness and conservatism, on tax avoidance. After applying targeted restrictions, 95 companies were selected from the statistical population in the period from 2014 to 2023, and the relationships between variables were analyzed with the help of combined data and the generalized least squares method. The results of the research show that representativeness bias and conservatism bias have a significant effect on tax avoidance.
The occurrence of optimism or pessimism indicates the existence of representativeness in the market, which causes people to overreact and not make rational decisions about issues, and information asymmetry and agency problems intensify. because according to agency theory, managers (due to being optimistic about future events) do not clarify financial information to achieve their goals and position, and since management optimism has a direct and significant effect on tax avoidance; Therefore, it can be said that with the increase in management optimism, tax avoidance also increases. Also, companies avoid recognizing and paying taxes through conservative accounting and tax management, using legal loopholes and laws and regulations, or changing their type of activity.
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