Journal of Tax Reform | 2026
Authors: Weichen X.; Mayburov I.А.
DOI: 10.15826/jtr.2026.12.1.246
Journal: Journal of Tax Reform
Year: 2026
Publisher: Ural Federal University
Document Type: Article
Open Access: All Open Access; Gold Open Access; Green Open Access
Cited by: 1
The study investigated the correlation of corporate digital transformation and tax avoidance among non-financial listed companies in China from 2011 to 2023. In the context of the rapidly evolving digital economy, we seek to assess how technological advances such as artificial intelligence, big data, cloud computing, and blockchain are impacting corporate tax behavior. Our hypothesis suggests digital transformation enhances financial operational capabilities and refines sophisticated tax planning, thereby increasing the likelihood of corporate tax avoidance. The results, based on annual report data, reveal a significant positive correlation: a one-unit increase in digital transformation is associated with a 0.06% increase in book tax difference (BTD), indicating that companies with higher levels of digitalization are more likely to engage in tax avoidance. Further heterogeneity analysis reveals that this effect is more pronounced among non-state-owned enterprises and companies audited by the Big Four accounting firms. These findings challenge the view that digital transformation inherently promotes tax compliance and instead highlights the potential of digital tools to facilitate tax avoidance. Furthermore, the observed heterogeneity across ownership structures and audit quality indicates that institutional environment and governance quality are important moderators in the digitalization-tax avoidance nexus. Our research underlines the urgent need for the government to strengthen digital tax governance to mitigate the unintended consequences of technological advancement, thereby emphasizing the importance and urgency of the issue. © Weichen X., Mayburov I.A., 2026.
China; corporate governance; digital transformation; listed companies; tax avoidance; tax compliance