The Impact of Different Tax and Accounting Treatments for Asset Expenditures on the Value of the Tax Base (an Applied Study)

The research aimed to determine the impact of the difference between tax treatments and the accounting treatments for asset expenditures on the value of the tax base during the tax period. This was achieved by determining the impact of the difference between tax treatment and the accounting treatment for each of the fixed assets depreciation expense, intangible assets amortization expense, asset impairment losses, and deferred tax on the value of the tax base during the tax period.
An applied study was conducted using data from a sample of 20 Egyptian companies listed on the Egyptian Stock Exchange, to test the impact of differences in tax treatments from accounting treatments for asset expenditures on the value of the tax base during the tax period, and to test the validity of the research hypothesis.
The research concluded that there is a significant impact of the difference in tax treatments from accounting treatments for asset expenditures on the value of the tax base during the tax period, and that Egyptian tax legislation does not fully adopt Egyptian accounting standards, especially with regard to the treatment of asset expenditures, and that tax depreciation is characterized by accelerated depreciation, and that there are no tax accounting standards in the Egyptian environment.
The research recommended the necessity of adapting Egyptian Accounting Standard No. 24 to be consistent with the Egyptian tax environment, narrowing the scope of choice between accounting measurement alternatives included in accounting standards, applying Egyptian Accounting Standard No. 31 tax-wise, working to issue Egyptian tax accounting standards, and encouraging establishments to choose methods and rates of depreciation and consumption that are consistent with tax legislation.