Corporate Tax Avoidance : Is paying a fair share of taxes a social responsibility?

Corporate tax avoidance is a phenomenon that affects countries and people all around the world. Big multinational corporations are avoiding taxes by complex, yet legal, tax strategies offered to them by big accountancy firms. Profits of these big corporations are shifted from high-tax jurisdictions into tax havens. Thus, avoiding or minimising their tax bill. This action consequently shifts the tax burden on other taxpayer groups and can harm state’s ability to offer its public infrastructure. This paper will reveal the scale of the issue and show evidence how tax havens, some governments and accountancy firms are all involved in a network that enables corporate tax avoidance to happen. The thesis will present ideas to whom we should pay taxes and why, as well as offer counterarguments and look at the matter using various competing theories. Tax transparency hasn’t been traditionally included in a corporate social responsibility statement. The paper will investigate whether tax transparency as a part of the corporate social responsibility would correlate with a reduced level of corporate tax avoidance. Finally, the thesis will showcase evidence and arguments about why paying a fair share of taxes can be seen as a company’s social responsibility