Public Tax Disclosures and Investor Perceptions

49 Pages Posted: 27 Jul 2022 Last revised: 6 Sep 2022

See all articles by Bart Dierynck

Bart Dierynck

Tilburg University

Martin Jacob

WHU - Otto Beisheim School of Management

Maximilian A. Müller

University of Cologne

Christian Peters

Tilburg University

Victor van Pelt

WHU - Otto Beisheim School of Management

Multiple version iconThere are 2 versions of this paper

Date Written: July 21, 2022

Abstract

To reveal whether firms pay their fair share of taxes, regulators are increasingly mandating public tax disclosures. Such disclosures are often assumed to raise public attention and help non-professional stakeholders, such as retail investors, identify aggressive tax avoiders. We conduct two experiments to test this assumption. Our first experiment indicates that retail investors become worse at identifying aggressive tax avoiders when disclosures focus on bottom-line tax numbers because such disclosures invite them to use these exclusively as heuristics. The results of the second experiment demonstrate that policies to counteract the adverse effects of public tax disclosures, such as requiring the provision of a disclaimer, are helpful but that none are fully effective.

Keywords: Public tax disclosure, corporate taxation, retail investors

JEL Classification: C91, H26, M48

Suggested Citation

Dierynck, Bart and Jacob, Martin and Müller, Maximilian A. and Peters, Christian P. H. and van Pelt, Victor, Public Tax Disclosures and Investor Perceptions (July 21, 2022). TRR 266 Accounting for Transparency Working Paper Series No. 94, Available at SSRN: https://ssrn.com/abstract=4173175 or http://dx.doi.org/10.2139/ssrn.4173175

Bart Dierynck (Contact Author)

Tilburg University ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands

Martin Jacob

WHU - Otto Beisheim School of Management ( email )

Burgplatz 2
D-56179 Vallendar, 56179
Germany

HOME PAGE: http://www.whu.edu/steuer

Maximilian A. Müller

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany

Christian P. H. Peters

Tilburg University

P.O. Box 90153
Tilburg, DC 5000 LE
Netherlands

Victor Van Pelt

WHU - Otto Beisheim School of Management ( email )

Burgplatz 2
Vallendar, 56179
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
61
Abstract Views
177
rank
148,504
PlumX Metrics