Tax Evasion, Disclosure and Participation in Financial Markets: Evidence from Brazilian Firms

39 Pages Posted: 18 Apr 2006 Last revised: 26 Nov 2008

See all articles by Thomas Kenyon

Thomas Kenyon

United Nations Industrial Development Organization

Date Written: 2006

Abstract

This paper addresses uses survey data and qualitative evidence from Brazilian manufacturing firms to examine the scale and consequences of tax evasion at the enterprise level. It discusses the costs and benefits of under-reporting from the entrepreneur's perspective and provides evidence that evasion of sales tax is only weakly correlated with firm size. The paper then shows that medium-sized and large manufacturing firms that evade taxes are less likely to undergo an external audit and more likely to be asked for informal payments by tax officials. It also argues that they may be less likely to participate in markets for equity finance.

Keywords: informality, capital markets, tax evasion, Brazil

Suggested Citation

Kenyon, Thomas, Tax Evasion, Disclosure and Participation in Financial Markets: Evidence from Brazilian Firms (2006). World Development, Vol. 36, No. 11, 2008. Available at SSRN: https://ssrn.com/abstract=1005424 or http://dx.doi.org/10.2139/ssrn.1005424

Thomas Kenyon (Contact Author)

United Nations Industrial Development Organization ( email )

Vienna International Centre
Vienna, DC
Austria

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
230
Abstract Views
1,134
rank
139,599
PlumX Metrics