What drives corporate tax planning strategies? This research investigates the extent to which companies benchmark their tax performance against comparable companies – in the same industry, or country, or of the same size. We hypothesize that while companies clearly gain from paying less tax, they may also suffer a reputational loss if their effective tax rate is too far out of line from their competitors. This suggests that the strategies used by companies may depend on those of their competitors. This hypothesis is tested using consolidated accounting data on a large number of companies resident in different countries. The empirical evidence suggests that such benchmarking does takes place – both within countries and within industries. Further, the analysis shows that benchmarking is most important for the largest companies, and for companies that have an average effective tax rate above the statutory tax rate.