Global Journal of Economics and Business

Volume 8 - Issue 2 (11) | PP: 323 - 329 Language : English
DOI : https://doi.org/10.31559/GJEB2020.8.2.11
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The Impact of Tax-Avoidance Measures by the Government on Taxable Income Differential Between Foreign- and Domestic Companies in Saudi Arabia

Ali Faya Alhassan
Received Date Revised Date Accepted Date Publication Date
9/2/2020 29/2/2020 11/3/2020 6/5/2020
Abstract
The purpose of this research to identify the existence of differences in taxes paid to the government due to different practices implemented in terms of transfer pricing by foreign companies operating in Saudi Arabia. The transfer pricing policies implemented by the foreign companies can lower the taxable income of the company which results in lower taxes for the companies. This study was conducted for multiple domestic and foreign countries operating in Saudi Arabia. Alhassan and Bajaher (2016), used different regression models to understand the relationships between transfer pricing, taxable income and the taxes paid by the companies operating in Saudi Arabia for the years 2016, 2017 and 2018 . These regression models were used to identify and measure the differences in taxes paid by the domestic and foreign companies operating in the country. The results of the statistical analysis showed that foreign companies pay more taxes as compared to the domestic companies in the country. The analyses showed that there is a mean difference of nearly 1.8% in the taxes paid by the companies based on their locations.


How To Cite This Article
Alhassan , A. F. (2020). The Impact of Tax-Avoidance Measures by the Government on Taxable Income Differential Between Foreign- and Domestic Companies in Saudi Arabia . Global Journal of Economics and Business, 8 (2), 323-329, 10.31559/GJEB2020.8.2.11

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