Comparative Analysis of Global Tax Regulations and Corporate Financial Reporting Practices
DOI:
https://doi.org/10.51699/ijbde.v3i5.191Keywords:
Global Tax Regulations, Corporate Financial Reporting, Tax Avoidance Strategies, Multinational Corporations, Financial Transparency, Regulatory Harmonization, Profit ShiftingAbstract
This paper explores the connection between international taxation and corporate reporting, in particular how overlapping tax jurisdictions affect the quality of corporate disclosures. With the growing complexity of international business and the differences between tax systems, understanding these interactions are important to policymakers and stakeholders. It employs a mixed-methods strategy that involves the literature review, quantitative analysis of financial statements from multinational companies and qualitative interviews with tax experts. The quantitative study employs regression approaches to distinguish commonalities in profit statements and tax liabilities across different systems of regulation; the qualitative insights highlight the challenges faced by e-commerce giants in navigating through fragmented tax regimes. This has a significant implication: the overall perception of seriousness between countries in tax and commercial programming can differ depending on how strict or lax their tax legislation is with corporations more likely to deploy profit shifting and minimisation tactics where the leveraging is lower. Therefore, it seems we have found substantial inconsistencies across global financial reporting practices! Industries that rely on intangible assets, like tech and pharma, are especially vulnerable to exploiting these discrepancies. The absence of alignment of international tax rules with financial reporting standards, in the conclusion shows great impediments to achieving harmonization of corporate governance and economic transparency worldwide. This study underlines that we need more international coordination in harmonising tax and reporting rules, to create a more equal and transparent global financial system. Regulatory challenges are growing, and future research should explore the impact of emerging technologies such as blockchain and digital assets on tax compliance and reporting practices.
References
Alon, A., & Dwyer, P. D. (2020). Global accounting standards and emerging markets: The case of IFRS adoption. Journal of International Business Studies, 51(5), 781-800.
Babor, T. F. (2023). A Political Economy Analysis of Health Taxes. Health Taxes: Policy and Practice, 431–484. https://doi.org/10.1142/9781800612396_0015 DOI: https://doi.org/10.1142/9781800612396_0015
Buettner, T., Overesch, M., & Schreiber, U. (2020). The impact of CbCR on multinational corporate tax transparency. Journal of Accounting and Public Policy, 39(2), 105-121.
Bunn, D., & Asen, E. (2021). Global tax policy and the digital economy: Challenges and reform initiatives. Tax Notes International, 101(3), 213-230.
Capraş, I. L. (2024). Analysis and Classification of Corporate Fraud Based on the Literature and Investigated Cases in Romania. Studies in Business and Economics, 19(2), 155–175. https://doi.org/10.2478/sbe-2024-0031 DOI: https://doi.org/10.2478/sbe-2024-0031
Hanlon, M., & Heitzman, S. (2020). A review of tax research in accounting. Journal of Accounting and Economics, 50(2-3), 127-178. DOI: https://doi.org/10.1016/j.jacceco.2010.09.002
Jayarathna, C. P. (2024). Perceived relationship between green logistics practices and sustainability performance: a multi-methodology approach. International Journal of Logistics Management, 35(5), 1522–1548. https://doi.org/10.1108/IJLM-09-2022-0367 DOI: https://doi.org/10.1108/IJLM-09-2022-0367
Nobes, C. (2022). The divergence between IFRS and national accounting standards in tax reporting: Evidence from emerging economies. Journal of International Financial Management & Accounting, 33(1), 95-116.
Pallot, S., Jones, G., & Smith, M. (2022). Corporate financial reporting practices in response to global tax regulation reforms. European Accounting Review, 31(2), 312-333.
Richardson, G., Taylor, G., & Lanis, R. (2021). Global tax regulations and corporate financial reporting practices: A comparative analysis. International Journal of Accounting, 56(4), 237-260.
Mamayunusovna, P. O. (2023). POVERTY ALLEVIATION IN THE COUNTRY THROUGH ENTREPRENEURSHIP DEVELOPMENT. The Journal of Economics, Finance and Innovation, 38-44.
Mardiyevna, S. G. (2023). Importance of Sustainable Development In The Modern World. The Journal of Economics, Finance and Innovation, 59-67.
Monteiro, S. (2023a). Corporate climate change-related accounting and taxation: A comparative analysis of Portuguese and Spanish frameworks on GHG emissions allowances. Taking on Climate Change Through Green Taxation, 57–81. https://doi.org/10.4018/978-1-6684-8592-7.ch003
Monteiro, S. (2023b). Corporate climate change-related accounting and taxation: A comparative analysis of Portuguese and Spanish frameworks on GHG emissions allowances. Taking on Climate Change Through Green Taxation, 57–81. https://doi.org/10.4018/978-1-6684-8592-7.ch003 DOI: https://doi.org/10.4018/978-1-6684-8592-7.ch003
Niu, J. (2024). Assessment and optimization of tunnel lighting quality based on drivers’ visual comfort: From methodology to application. Tunnelling and Underground Space Technology, 143. https://doi.org/10.1016/j.tust.2023.105487 DOI: https://doi.org/10.1016/j.tust.2023.105487
Ozodbek, T., & Zumira, N. (2023). Uzbekistan: Choosing Green Future. The Journal of Economics, Finance and Innovation, 232-239.
Rexhepi, B. R. (2024). Analysis of the effectiveness of freelance exchanges and their demand among corporate customers in the context of tax regulation. Scientific Bulletin of Mukachevo State University. Series Economics, 11(1), 60–70. https://doi.org/10.52566/msu-econ1.2024.60 DOI: https://doi.org/10.52566/msu-econ1.2024.60
Muslim, M. (2024). Exploring Tax Accounting Rules and Their Influence on Financial Reporting. Advances in Taxation Research, 2(1). https://doi.org/10.60079/atr.v2i1.245 DOI: https://doi.org/10.60079/atr.v2i1.245
Velte, P. (2019). What do we know about meta-analyses in accounting, auditing, and corporate governance? Meditari Accountancy Research, 27(1), 17–43. https://doi.org/10.1108/MEDAR-03-2018-0317 DOI: https://doi.org/10.1108/MEDAR-03-2018-0317
Wu, Y. (2024). Vertical decentralization, environmental regulation, and enterprise pollution: An evolutionary game analysis. Journal of Environmental Management, 349. https://doi.org/10.1016/j.jenvman.2023.119449 DOI: https://doi.org/10.1016/j.jenvman.2023.119449
