China Accounting and Finance Review

, 17:5

First online:

Open Access This content is freely available online to anyone, anywhere at any time.

Does Control Privatisation Affect Corporate Tax Aggressiveness?

  • Liangliang WangAffiliated withSchool of Economics and Management, Southeast University Email author 
  • , Yuetang WangAffiliated withSchool of Management, Nanjing University


The extant literature has shown that “control privatisation” (CP) can improve corporate performance. There is little evidence, however, on how CP affects corporate performance. This paper investigates this issue from the perspective of tax planning. Using a difference-in-differences (DID) model with paired samples as a control group, we examine whether corporate tax aggressiveness changes after CP. The results suggest that after CP, corporations exhibit increased tax aggressiveness compared with the paired sample. Further, compared with the paired sample, the tax aggressiveness of central government owned corporations does not change after privatisation, while local government owned corporations become more tax aggressive after privatisation. Our results hold constant under a series of robustness tests. This paper not only enriches the literature on tax planning but also provides new evidence concerning the effect of CP on corporate performance.


Control Privatisation Non-tax Costs Tax Aggressiveness Political Hierarchy