Corporate governance and tax compliance

Abstract

This study has provided empirical evidence where the corporate tax compliance does have a significant relationship with corporate governance mechanisms. The study covered the period of pre MCCG (Malaysian Code on Corporate Governance) revision (2005 to 2006) and post MCCG revision (2007 to 2008). The statistical results reveal that MCCG does influence a constructive impact on the level of corporate tax compliance in Malaysia. Although the efforts of establishing MCCG and strengthening the code by the MCCG revision in year 2007 was not embrace directly to increase the level of corporate tax compliance. But, this study has successfully provided empirical evidence where the corporate tax compliance does have a significant relationship with corporate governance mechanisms. The findings of this study will give another angle of deliberation to the corporate governance interests' as well as the corporate taxation.