AbstractThe present study examines the mechanisms of the halo effect and the scepticism effect as alternative explanations for the association between a firm's corporate social responsibility (CSR) engagement and consumers' perceptions of its tax behaviour. The authors conduct two experimental studies to examine the impact of a company's CSR domain on consumers' perceptions of its tax practices (Study 1) and the impact of a company's CSR engagement and tax practices on consumers' evaluations of that company (Study 2). It was found that consumers' perceptions of a firm's tax practices critically depend on CSR domains. Specifically, when inferring tax perceptions from CSR engagement, consumers factor in their perceptions of the greater direct reputational benefits that firms derive from external CSR engagement (environmental and philanthropic CSR) compared with those they derive from internal CSR engagement (activities focused on intraorganisational stakeholders). Suggestions for managerial implications and future research are also discussed.