This study examines the relation between long-run tax avoidance ability and firm value. Further, we also examine the effect of long-run tax avoidance ability on firm value varies with the persistence and stability of tax avoidance. Many prior studies provide empirical evidence on the negative relation between short-run tax avoidance and firm value. However, these studies just focus on the short-run tax avoidance. Yet it remains unclear whether this result still holds with the relation between long-run tax avoidance and firm value. Firms use various ways to minimize tax. Some ways have just temporary effects, but others have long term effects. For example, when a firm use a temporary book tax difference such as an accelerated depreciation to minimize tax for a certain period, the effect is temporary because the firm must pay more taxes in the subsequent year when the difference is reversed. Furthermore, when a firm implements an aggressive tax strategy, it could be effective to reduce tax burden in the short term. However, if a subsequent tax audit finds that there was an illegal tax evasion, this type of tax avoidance may have negative effects on future cash flows in the long term because the firm must pay penalties as well as back taxes. Like this, short-run tax avoidance has the different implications for future cash flows from long-run tax avoidance. Thus, we expect the positive relation between long-run tax avoidance and firm value despite the negative relation between short-run tax avoidance and firm value. Meanwhile, cash savings resulting from tax avoidance are less likely to link to increase in firm value if the cash savings are reversed in the subsequent years or are not sustainable in the long term. In addition, if the volatility of tax avoidance outcome is high, market may undervalue cash savings resulting from tax avoidance because it may be uncertain. From this perspective, we expect the relation between long-run tax avoidance and firm value is more strong when the tax avoidance outcome is more persistent and stable. To test this conjecture, we analyze 5,076 observations from 2004 to 2014 for firms listed on Korea Stock Exchange and KOSDAQ. We measure long-run tax avoidance ability using industrysize adjusted effective tax rate. The empirical results are as follows. First, we find the positive relation between long-run tax avoidance ability and tobin’s q. Second, this relation is more pronounced for firms with more persistent and less volatile tax avoidance outcome. This paper has several contributions to the literature. First, to our knowledge, ours is the first study to investigate long-run tax avoidance and firm value. Second, this study shows that market responds differently to short-run tax avoidance and long-run tax avoidance.