Tax avoidance and debt maturity in SMEs

Sánchez Ballesta, Juan Pedro; Yagüe, José

Publication:
Tax avoidance and debt maturity in SMEs

dc.contributor.author	Sánchez Ballesta, Juan Pedro
dc.contributor.author	Yagüe, José
dc.contributor.department	Economía Financiera y Contabilidad
dc.date.accessioned	2024-05-08T22:10:56Z
dc.date.available	2024-05-08T22:10:56Z
dc.date.issued	2024-01-30
dc.description	© 2024 The Authors. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/ This document is the Published version of a Published Work that appeared in final form in Journal of International Financial Management and Accounting. To access the final edited and published work see https://doi.org/10.1111/jifm.12201
dc.description.abstract	We investigate how tax avoidance affects the maturity structure of debt in firms where tax avoidance costs are presumably low, namely SMEs. Previous research has shown that creditors of listed tax‐avoiding companies impose shorter maturities to more frequently reassess the tax avoidance risks in debt contracts. Using a sample of 110,690 firm‐year observations of Spanish SMEs over the period 2007–2020, we examine the relationship between tax avoidance and debt maturity and the channels driving this relationship. We find that tax‐avoiding SMEs show a longer debt maturity. This effect is stronger for SMEs with higher profitability, lower earnings management incentives, and higher reliability of financial reporting. We also find that tax avoidance reduces leverage and short‐term debt, increases future cash flows, and decreases future cash flow volatility. Overall, these findings suggest that, unlike large firms, SMEs use cash tax savings to reduce leverage and short‐term debt in their financial struc ture and that tax avoidance is positively valued by their lenders.
dc.format	application/pdf	es_ES
dc.format.extent	36
dc.identifier.citation	Journal of International Financial Management and Accounting, Vol. 35, N. 2, 2024, pp. 426-464
dc.identifier.doi	https://doi.org/10.1111/jifm.12201
dc.identifier.issn	Electronic: 1467-646X
dc.identifier.issn	Print: 0954-1314
dc.identifier.uri	http://hdl.handle.net/10201/141452
dc.language	eng	es_ES
dc.publisher	Wiley
dc.relation	Fundación Cajamurcia; MCIN/AEI/ 10.13039/501100011033
dc.relation.isreferencedby	ED_IDENTRADA=1404
dc.relation.publisherversion	https://onlinelibrary.wiley.com/doi/epdf/10.1111/jifm.12201
dc.rights	info:eu-repo/semantics/openAccess	*
dc.rights	Attribution-NonCommercial-NoDerivatives 4.0 Internacional	*
dc.rights.uri	http://creativecommons.org/licenses/by-nc-nd/4.0/	*
dc.subject	Banks	es_ES
dc.subject	Debt maturity	es_ES
dc.subject	SMEs	es_ES
dc.subject	Tax avoidance	es_ES
dc.title	Tax avoidance and debt maturity in SMEs	es_ES
dc.type	info:eu-repo/semantics/article	es_ES
dspace.entity.type	Publication	es
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