Abstract

This research aims to demonstrate the influence of accounting conservatism and Gray's accounting values on the practice of corporate tax avoidance. By analyzing a dataset consisting of 14,500 firms from 75 countries over the period of 2000 to 2022, and utilizing the generalized method of moments (GMM) methodology, the study demonstrates a positive correlation between accounting conservatism and elevated effective tax rates. This finding implies a decrease in tax avoidance. The study combines agency and deterrence theories with the theory of reasoned action to analyze the impact of accounting practices on corporate behavior. The findings suggest a positive relationship between professionalism and secrecy in accounting and higher levels of tax avoidance. Conversely, a negative association is observed between uniformity and conservatism in accounting and tax avoidance. This study makes a substantial contribution to the fields of accounting and finance by demonstrating the intricate relationship between accounting practices, cultural values, and tax strategies.

Key words: Tax avoidance, accounting conservatism, professionalism, uniformity, conservatism, secrecy.