The Effect of Tax Planning on Firms Market Performance

Tax planning is efficient utilizing of regulatory tools، incentives and exemptions offered by the government to reduce the amount of taxes paid to the government. The purpose of this study is to investigate the impact of tax planning on the market performance of firms listed in Tehran Stock Exchange (TSE) during the period of 2004 to 2011. The measure of tax planning is tax savings and the firm''s market performance is proxied by Tobin''s q ratio. The population of study includes all firms listed in TSE، from which، 65 firms are selected as research sample. In this study، multivariate linear regression model is used to test the hypotheses. The findings indicate that there is no significant relationship between tax planning، firms size، sales growth with firms market performance. In addition، the results indicate that there is a significant relationship between firm’s age and financial leverage with firms market performance.