We examine the impact of terrorism risk on corporate tax avoidance. We find that firms headquartered in areas with a higher terrorism risk engage in more corporate tax avoidance. Further, we show that terrorism risk has a greater impact on corporate tax avoidance when terrorist attacks are severe in terms of the targets hit, damage, and the numbers of victims. Tests on channels show that higher terrorism risk is associated with firms suffering greater financial constraints. We provide evidence that increased terrorism risk is also associated with the reallocation of US Internal Revenue Service budgeted expenditures away from tax return audit enforcement and towards increased funding for the Internal Revenue Service Criminal Investigative Division combating terrorism. We conclude that terrorism risk increases and facilitates the corporate demand for tax savings.

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恐怖主义和企业避税

我们研究了恐怖主义风险对企业避税的影响。我们发现，总部设在恐怖主义风险较高地区的公司从事更多的公司避税活动。此外，我们表明，当恐怖袭击的目标、损害和受害者人数等方面严重时，恐怖主义风险对企业避税的影响更大。对渠道的测试表明，较高的恐怖主义风险与遭受较大财务限制的公司有关。我们提供的证据表明，恐怖主义风险的增加也与美国国税局预算支出的重新分配从纳税申报审计执法和增加对国税局打击恐怖主义的刑事调查部门的资金有关。