Technological advancement in non-audit services and their roles in tax avoidance

Long-term tax avoidance has become a major topic of academic study since global tax systems are getting more complicated. Recently, businesses adopting sophisticated strategies to minimize tax liabilities. Traditionally, audit companies provided non-audit services (NAS). However, nowadays these services have changed a lot mostly due to improvements in technology. These services which include tax advisory and consulting are very important in shaping how businesses plan their taxes, especially in the context of tax avoidance. Integrating technologies like artificial intelligence (AI), data analytics and blockchain have changed the scope of NAS. This raises question on what is their role in long-term tax avoidance practices. Numerous studies have been done on the legal and moral problems that come up with NAS (DeFond & Zhang, 2014; Krishnan & Yu, 2017), but not much has been written about how technological innovations in NAS affect tax avoidance strategies. Scholars have long debated the implications of audit firms providing NAS, arguing that this could result to conflicts of interest, compromised audit quality, and regulatory issues (Chen et al., 2021). But there has not been much focus on how these services, powered by emerging technologies might improve or change tax avoidance strategies. As more and more advanced technological tools are used for tax planning, it is important to assess how these new technologies advancement affect corporate behaviour when it comes to long-term tax avoidance strategies. This study tries to fill in that gap by looking into investigating the intersection of technological advancements in NAS and their role in facilitating or mitigating tax avoidance. This research is significant for several reasons. It fills a significant gap in the literature by addressing the impact of technology on the transformation of NAS and its consequences for tax avoidance. Secondly, it provides insights on how businesses use technological advancements in tax planning and advising services to minimise taxes which may have an impact on corporate governance standards and regulations. Finally, this study has implications for auditors, regulators and policymakers by illuminating the ethical considerations related to the integration of technology in NAS.

Publication Details

Journal
UiTM Institutional Repositories (Universiti Teknologi MARA)
Published
2024-10-24
Primary Topic
Corporate Taxation and Avoidance
Type
article
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article

Technological advancement in non-audit services and their roles in tax avoidance

UiTM Institutional Repositories (Universiti Teknologi MARA)
Corporate Taxation and Avoidance
article

Technological advancement in non-audit services and their roles in tax avoidance

article en

Abstract

Long-term tax avoidance has become a major topic of academic study since global tax systems are getting more complicated. Recently, businesses adopting sophisticated strategies to minimize tax liabilities. Traditionally, audit companies provided non-audit services (NAS). However, nowadays these services have changed a lot mostly due to improvements in technology. These services which include tax advisory and consulting are very important in shaping how businesses plan their taxes, especially in the context of tax avoidance. Integrating technologies like artificial intelligence (AI), data analytics and blockchain have changed the scope of NAS. This raises question on what is their role in long-term tax avoidance practices. Numerous studies have been done on the legal and moral problems that come up with NAS (DeFond & Zhang, 2014; Krishnan & Yu, 2017), but not much has been written about how technological innovations in NAS affect tax avoidance strategies. Scholars have long debated the implications of audit firms providing NAS, arguing that this could result to conflicts of interest, compromised audit quality, and regulatory issues (Chen et al., 2021). But there has not been much focus on how these services, powered by emerging technologies might improve or change tax avoidance strategies. As more and more advanced technological tools are used for tax planning, it is important to assess how these new technologies advancement affect corporate behaviour when it comes to long-term tax avoidance strategies. This study tries to fill in that gap by looking into investigating the intersection of technological advancements in NAS and their role in facilitating or mitigating tax avoidance. This research is significant for several reasons. It fills a significant gap in the literature by addressing the impact of technology on the transformation of NAS and its consequences for tax avoidance. Secondly, it provides insights on how businesses use technological advancements in tax planning and advising services to minimise taxes which may have an impact on corporate governance standards and regulations. Finally, this study has implications for auditors, regulators and policymakers by illuminating the ethical considerations related to the integration of technology in NAS.

UiTM Institutional Repositories (Universiti Teknologi MARA)
Openalex Percentile: Top 30%
Corporate Taxation and Avoidance
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