The cheaper the company has been able to produce goods with better quality and specific characteristics, and the closer it gets to monopoly conditions, the more tax evasion behavior it will perform. Companies with such capabilities are able to achieve higher and more sustainable levels of their accrual income in order to maintain a position in the product market. The purpose of this study is to investigate the effect of competition in the product market on the relationship between the probability of bankruptcy and tax avoidance. The statistical population of the study of companies listed on the Tehran Stock Exchange and the study sample includes 143 companies listed during the years 1394 to 1398. The research method is descriptive-survey and in terms of the relationship between variables is a combination of causal-correlation and is applied in terms of purpose and post-event in terms of event. Regression method and panel data as well as fixed effects model have been used to process and test the hypotheses. The results show that the probability of bankruptcy has a positive and significant relationship with tax avoidance and competition in the product market has a positive and significant effect on the relationship between the probability of bankruptcy and tax avoidance.
Keywords: Product Market Competition, Tax Avoidance, Bankruptcy Probability