Blockchain adoption and tax avoidance

This study examines how firms' adoption of blockchain technology influences tax avoidance practices. Drawing on agency theory, we hypothesize that blockchain's core attributes—immutability, transparency, and traceability—reduce managerial discretion and constrain tax avoidance. Using a structured practitioner survey and archival data analysis, we provide complementary evidence supporting this hypothesis. Survey results indicate that a majority of respondents report reductions in tax avoidance following blockchain adoption, attributing these effects to blockchain's core attributes. Archival analysis corroborates these findings, showing a positive correlation between blockchain adoption and higher cash effective tax rates ( CETR ), indicative of reduced tax avoidance. The impact is particularly pronounced in firms with weaker internal corporate governance and poorer information environments, where blockchain functions as a governance-enhancing technology that substitutes for traditional monitoring mechanisms. Our findings contribute to the emerging literature on blockchain's organizational implications, providing insights for practitioners, regulators, and policymakers into its potential as a governance tool in corporate tax planning.