Archives

A Short Analysis on Risk of Listed Viet Nam IT Firms Under Impact of Fiscal Policy Effects


Dr. Nguyen Van Thuy
Abstract

Information technology (IT) is one of the fastest growing industries in Vietnam as well as in other Asian countries. One of essential objectives of this paper is to assess the tax rates effects on IT companies ' market risk levels, which includes software and hardware firms. Our first finding is that beta values of 22 listed companies in Viet Nam's IT industry are satisfactory when we calculate asset beta and beta CAPM of them, applying quantitative, statistical and analytical methods. In addition, we have measured adjustments throughout the rate of tax in three cases (20%, 25% and 28%). And from there we realize that perhaps the 25 percent tax rate does not have very dispersed equity beta values estimated at 0.740.725 and 0.746, lower than those of the listed VN construction enterprises. In the last study, we acknowledge that when we substitute taxes (25%, 20%, and 28%), Beta CAPM or Equity beta decreases if tax rate move from 20% to 25%, while increase in case tax rate rises by 28%. On the contrary, the average asset beta value increases in two similar thresholds first and then falls. At last, policies in risk management and governance are suggested in the conclusion based on the research results and findings.

Volume 12 | 03-Special Issue

Pages: 588-596

DOI: 10.5373/JARDCS/V12SP3/20201296