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Case Study from the year 2022 in the subject Business economics - Business Management, Corporate Governance, , language: English, abstract: Multinational corporations (MNCs) are able to review the world's tax legislation and take advantage of the loopholes and anomalies in the tax legislation of the various nations, thus avoiding the payment of billions of dollars in taxes. Based on the case of IKEA Group, both tax evasion and tax avoidance are unethical when elements such as social inequality, undermining of tax compliance, unfairness in competition between different firms, violation of…mehr

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Case Study from the year 2022 in the subject Business economics - Business Management, Corporate Governance, , language: English, abstract: Multinational corporations (MNCs) are able to review the world's tax legislation and take advantage of the loopholes and anomalies in the tax legislation of the various nations, thus avoiding the payment of billions of dollars in taxes. Based on the case of IKEA Group, both tax evasion and tax avoidance are unethical when elements such as social inequality, undermining of tax compliance, unfairness in competition between different firms, violation of social contracts between corporations and host communities, and erosion of tax revenues for society are present. IKEA's practices are unethical from a consequentialist ethical standpoint due to the negative effects of their practices on society, as well as from a deontological standpoint due to their failure to respect not only the letter and spirit of the law, but also the rights of communities, competitors, nations, individual taxpayers, and other stakeholders. Tax evasion and avoidance significantly contribute to the undermining of the compliance culture as they undermine the tax system¿s integrity, thus leading to weaker compliance. The evaluation of the actions and measures that HMRC apply for tax compliance in light of the ethical issues of tax avoidance and evasion indicates that the approaches would lead to great successes in the reduction of tax avoidance and evasion.
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