The Impact of State Ownership on Tax Avoidance Behavior of Listed Companies in the Vietnamese Stock Market

This paper investigates the impact of state ownership on corporate tax avoidance among Vietnamese listed firms during 2015–2022. Drawing on agency theory, the study emphasizes the dual role of the state as both regulator and shareholder, which may either constrain or facilitate tax planning depending on institutional settings. Using 2,350 firm-year observations and applying robust regression techniques to address heteroskedasticity and autocorrelation, the results show that state ownership is negatively associated with tax avoidance, indicating that government shareholders limit aggressive strategies due to reputational and fiscal considerations. Financial leverage also reduces tax avoidance, while firm growth increases it, reflecting different financing incentives and expansion pressures in a transitional market. Audit quality, proxied by Big4 auditors, surprisingly shows a positive relationship, suggesting larger firms may exploit auditor expertise to engage in more sophisticated tax planning, whereas auditor switching has no significant effect. Overall, the findings enrich the literature by providing novel empirical evidence from Vietnam, a frontier market where the state still plays a dominant role in corporate governance. The study contributes to debates on the ownership–tax avoidance nexus, highlights the interplay between capital structure and governance mechanisms, and offers policy implications for regulators seeking to strengthen compliance, enhance transparency, and ensure equitable tax enforcement in emerging economies.