The present study examines the market reaction to news of corporate tax aggressiveness from 1990 to 2012. On average, the sample shows a statistically significant negative stock price reaction of 0.5 percent in response to news of involvement in tax aggressiveness. The market reacts less negatively for firms with a higher cash effective tax rate(ETR), indicating that the firm is not aggressive enough, resulting in news of tax aggressiveness being considered in a positive light. The companies spending high advertising expenses get more negative market reactions, suggesting that negative market reaction may be based on the loss of reliability of the firm and a customer backlash. For governance, measured using the percentage ownership of the controlling shareholder and of foreign shareholders, the results do not indicate a significant difference in market reactions between poorly governed and well governed companies. However, the estimated coefficient CASH ETR is positive and significant only for firms with higher proportions of foreign shareholders than the sample median proportions of foreign shareholders.