Determinants Of Tax Avoidance Research Articles

Determinants of Tax Avoidance and the Moderation Role of Asset Growth: A Case of Southeast Asia Banking Industry

Determinants of Tax Avoidance and the Moderation Role of Asset Growth: A Case of Southeast Asia Banking Industry

Determinants of Tax Avoidance and Audit Quality as a Moderating Variable

Taxes is The largest contribution for every country financial forecast. The Government maximizes their effort to be able increasing taxes, in order to accomplish the needs of their people. Companies are one of the biggest expenses of country need to be able to be financed. As a result, the government's efforts can create conflicts and it is not in line with the company's goals it self. The company will try to do a tax avoidance scheme in order to reduce the amount of the tax burden, however it will trigger various problems. Agency theory that can solve those problems that arise, from company as an agent. There are factors impact on tax avoidance, it consists of institutional ownership and corporate social responsibility. Audit quality is taken as a moderating variable, in analyzing the effect between the two independent variables, either strengthens or weakness. This type of research is quantitative research that uses the company's annual report as sources data. The sample in this study amounted to 43 mining companies listed on the Indonesia Stock Exchange in 2017-2019 and were selected based on purposive sampling technique. The results of data testing show that institutional ownership has no significant positive effect on tax avoidance, while corporate social responsibility has a significant positive effect on tax avoidance. Audit quality is showed to be able to weaken the influence of institutional ownership on tax avoidance and strengthen the influence of corporate social responsibility on tax avoidance.

Determinants of Tax Avoidance

The purpose of researchers in carrying out research is to: Analyze how much managerial ownership influences Independent Commissioners, Audit Committees, Financial Distress, and Company Size, and Analyze how much Company size can moderate the independent variables. Researchers conducted research on all manufacturing companies that were listed on the Indonesian Stock Exchange from 2016 to 2020. In determining the research sample, the researcher used a purposive sampling method. From this sampling method, there were 54 companies for 5 years, which totaled 270 sample data. Researchers used multiple linear regression analysis and moderated regression analysis for research data analysis methods by utilizing EViews software version 11. The results showed that independent commissioners & audit committees had an influence on tax evasion. In addition to these findings, it was also found that managerial ownership and financial distress had no effect on tax evasion. For testing moderation, the results obtained by the researcher prove that company sizes are able to moderate managerial ownership, independent commissioners, and audit committees on tax evasion. Meanwhile, the company has been unable to moderate financial difficulties on tax avoidance.

Good Corporate Governance and Company Risk as Determinants of Tax Avoidance PT. Centra Lautan Pewarna With Availability of Financial Statements

Tax Avoidance as a legal act or allowed by taxpayers by taking advantage of the legal weaknesses of the Law to reduce the tax burden of the company. Fokus this study utilizes the availability of company financial statements, this research is based on the emergence of tax avoidance problems at PT Centra Lautan Pewarna the purpose of the study is to study good corporate governance and company risk as determinants of tax avoidance PT. Centra Lautan Pewarna with the availability of financial statements. The author's research method uses a qualitative type, with a library research approach and analyzing content, the primary data material used comes from the company's financial statements for five years, the author adds primary data based on the availability of empirical data, the results of this study show that: 1) PT Centra Lautan Pewarna in an effort to comply with the payment of corporate Taxes as stipulated in Undang-U ndang Nomor 28 of 2009 concerning Pajak Daerah and Rattribution Daerah is very good. 2) Implementation of provisions on tax avoidance by PT Centra Lautan Pewarna as an effort to save taxes by minimizing taxable obligations, in accordance with the empirical said by Budiman & Setiyono (2012) using the cash effective tax rate (CETR) properly, and 3) Good support from Good corporate governance and company risk as determinants of tax avoidance in accordance with Fadhiah's theory (2014) has been implemented and proven well.

Efeitos da responsabilidade tributária de gestores na relação entre autuação e agressividade fiscal

ABSTRACT The aim of this research was to assess the moderating role of the joint and several liability of company directors in the relationship between the cumulative value of tax infraction notices and the subsequent level of corporate tax avoidance. Based on agency theory, the literature suggests that penalizing managers is more effective in reducing tax avoidance than penalizing the firm itself. However, this proposition had not been tested in Brazil, where the legislation determines that infraction notices and the consequent penalization of companies are carried out with the joint and several liability of the directors who have acted in excess of their powers or in violation of the law, the articles of incorporation, or the bylaws. The research is relevant because it presents empirical findings on the determinants of tax avoidance in large companies, as well as demonstrating the importance of the establishment of tax liability in controlling tax avoidance. This research has implications for the public debate on the establishment of tax liability, particularly its role in deterring tax avoidance. As a practical implication, it is suggested that the tax authority prioritizes tax audits that provide evidence that could lead to the tax liability of directors. The research consisted of a multiple linear regression analysis using the ordinary least squares (OLS) method on 23,142 observations from 4,560 large companies, covering the period from 2014 to 2020, collected directly from the internal systems of the Brazilian Federal Revenue Office (RFB). The results suggest that the joint and several liability of directors attenuates (intensifies) the positive relationship between the cumulative value of tax infraction notices and tax avoidance, as measured by the book tax difference (BTD) [effective tax rate (ETR)], contributing to the literature by confirming, in relation to current taxes, the theoretical prediction that penalties applied to directors are more effective, from the point of view of the tax authority, in controlling tax avoidance.

DOES TAX AVOIDANCE DIFFER BETWEEN ECONOMIES AND SECTORS? DETERMINANTS OF TAX AVOIDANCE IN DEVELOPED AND EMERGING ECONOMIES

Purpose This study aims to examine whether tax avoidance determinants result in different levels of avoidance depending on the country and sector. Prior literature finds that firms in developed countries avoid taxes (Dyreng et al. 2008, 2017). However, the level of tax avoidance differs across developed economies (Lee and Swenon, 2012; Thomsen and Watrin, 2018). In emerging economies, there are few studies that investigate tax planning and the results are not always in line with developed economies. Design/methodology/approach We expect that the extent of tax avoidance also differs between developed and emerging economies. We use a sample of firms from major economies (IMF, 2018), the G7 countries, and firms from major emerging economies, called BRICS (Brazil, Russia, India, China, and South Africa). We use a panel data multilevel analysis. Findings We find that the country and sector can influence tax avoidance practices to some extent and must be considered in the decision-making process regarding companies’ new international investments. It is also possible to observe that some determinants of tax avoidance do not yield different tax avoidance levels across countries and sectors. Originality This study fills a gap in the tax avoidance literature, showing that tax avoidance determinants may not accurately predict tax avoidance behaviour, depending on the country, industry, and level of regulatory enforcement.

Determinant of Tax Avoidance During Covid-19 Pandemic on Tourism, Restaurant, and Hotel Companies in Indonesia Stock Exchang

Indonesia's tourism industry occupies the third position in foreign exchange earnings after oil and gas. But the world was shocked by the arrival of the corona virus pandemic in early 2020. Owing to the arrival of this corona virus, the government forced the government to make a new policy, namely Large-Scale Social Restrictions (PSBB). This new policy has had a major impact on the decline in economic progress. Thus,As a result, the revenue of the tourism sector has decreased. Company owners will also usually urge executives to avoid tax by reducing the tax burden. This research plans to examine the elements that have an impact on tax avoidance during the corona virus pandemic in companies that are Indonesia's tourism industry occupies the third position in foreign exchange earnings after oil and gas. But the world was shocked by the arrival of the corona virus pandemic in early 2020. Due to the arrival of this corona virus, the government forced the government to make a new policy, namely Large-Scale Social Restrictions (PSBB). This new policy has had a major impact on the decline in economic progress. Thus income in the tourism sector is reduced. Company owners will also usually urge executives to avoid tax by reducing the tax burden. This research plans to examine the elements that have an impact on tax avoidance during the corona virus pandemic in companies that are included in the classification of the tourism, restaurant, and hotel industries in the first, second, and third quarters of 2020. The research data collected will be processed using regression analysis. multiple. The sampling technique was determined based on the criteria. The results of this research prove that profitability and firm size have a negative effect on tax avoidance. Meanwhile, institutional ownership and audit committee have no effect on tax avoidance. in the classification of the tourism, restaurant, and hotel industries in the first, second, and third quarters of 2020. The research data collected will be processed using regression analysis. multiple. The sampling technique was determined based on the criteria. The results of this research prove that profitability and firm size have a negative effect on tax avoidance. Meanwhile, institutional ownership and audit committee have no effect on tax avoidance.

Financial constraints and corporate governance as moderating variables for the determinants of tax avoidance

The purpose of this study is to empirically investigate the effect of financial constraints and corporate governance as moderating variables on the determinants of tax avoidance, which includes foreign activity, corporate social responsibility, and political connections. All companies listed on the Indonesia Stock Exchange from 2017 to 2019 are the objects of this study. The panel data regression was used to address the research question. The findings show that foreign activity, corporate social responsibility, and political connections significantly affected tax avoidance with alpha 5%. The results also show that corporate governance can reduce the positive impact of foreign activity, corporate social responsibility, and political connection on tax avoidance with alpha 1%.Moreover, financial constraints may strengthen the positive impact of corporate social responsibility on tax avoidance with alpha 5%. The findings further provide empirical evidence about one of the strategies businesses use to conduct tax avoidance, notably foreign activity, corporate social responsibility, and political connection. Thus, companies that implement good corporate governance could reduce corporate tax avoidance acts, which can harm the company’s image and lead to a decrease in company value. This study discovered a new proxy for measuring financial constraints, as well as developments in the political connection.

Determinants of Tax Avoidance on Consumption Business Sector in Indonesia

Determinants of Tax Avoidance on Consumption Business Sector in Indonesia

THE IMPACT OF TAX AVOIDANCE, SUSTAINABILITY REPORT DISCLOSURE, AND EARNINGS MANAGEMENT ON FIRM VALUE IN THE DIGITAL ERA WITH CORPORATE GOVERNANCE AS A MODERATING VARIABLES

This paper aims to determine whether tax avoidance, sustainability reporting, and earnings management affected firm value. Samples were collected from 80 companies listed on the Indonesian Stock Exchange (BEI)between 2015 and 2019. This research is an explanatory study that employs a quantitative approach and purposive sampling as the sampling technique, using the Absolute Difference Value Method to examine the moderating variable’effect, and SPSS 23 to analyze the data. The finding indicate that while tax avoidance has no negative effect on firm value and Sustainability Report has no positive effect on firm value, earnings management have negative effects on firm value. Corporate Governance did not weaken the effect of tax avoidance on firm value, corporate governance did not strengthen the relationship between sustainability reports and firm value and Corporate Governance weakens the negative effect of earnings management on firm value. This paper contributes to three different strands of research:determinants of tax avoidance in Indonesia for government literature, evaluation, improve, improvement, and performance for companies;for investors, as it is wordthwhile to consider additional factors in order to aid in making an informed assessment of company’s value in this era of technology.

The effect of tax avoidance, sustainbility report, corporate governance on firm value: Leverage as moderating (Empirical Study On Registered Manufacturing Companies On the Indonesia Stock Exchange 2014-2019)

Disclosure about the factors that influence firm value is the aim of this study. Tax avoidance variables, sustainability reports, corporate governance practices and leverage are thought to influence firm value. Samples were selected based on certain criteria. Therefore, data obtained from the Indonesia Stock Exchange as many as forty companies for six years (2014 to 2019). The results reveal that tax avoidance, sustainability reporting, corporate governance practices affects firm value in a negative direction. Meanwhile, leverage affects firm value in a positive direction. The effect of the sustainability report on firm value is proven not to be strengthened by the leverage variable as a moderating variable, but it does strengthen the effect of tax avoidance and corporate governance on firm value.. Originality / Value - This paper contributes to three different series of studies: the literature on government as a determinant of tax avoidance in Indonesia. For companies, evaluate, improve, improve performance. For investors, to assist in making wise judgments about the value of the firm, it is worth considering other factors and for the academy as the theoretical library used. For further research with institutional ownership variable, financial crisis as a moderating variable.

Determinants of Tax Avoidance of Public Listed Companies in Indonesia

Current literatures on the factors that effects tax avoidance in corporation produced mix result. Therefore, this study aims to obtain empirical evidence on the influence of ownership structure and corporate governance on tax avoidance and to examine the differences in the tax avoidance before and after-tax amnesty. The population of the study is public listed companies in the Indonesia Stock Exchange for the period of 2012-2017. Data was collected using a purposive sampling method. This study uses multiple regression analysis to investigate determinants of tax avoidance of public listed companies. The results showed that foreign ownership, family ownership and independent directors did not significantly influence tax avoidance. However, the CG-score Index has a significant effect on tax avoidance. The finding also showed there was no difference in the tax avoidance before and after the application of tax amnesty. The result of this study provides more and accurate information including the recognition of permanent and temporary differences that are commonly used as loopholes in tax avoidance action. It can be utilized as input for the Directorate General of Tax (DJP) to evaluate tax regulations, with the hope of increasing taxpayer compliance.

Determinants of tax avoidance – evidence on profit tax-paying companies in Romania

Our objective is to investigate the determinants of tax avoidance in Romanian companies in 2013–2017. Our initial sample comprises 236 privately owned companies that are payers of profit tax and have been found guilty of tax evasion. This was matched with 236 ‘compliant’ companies structured similarly by industry, whereas the final sample comprises 1674-year-observations. We defined ‘compliant’ those companies that have never been prosecuted for tax evasion. Our main finding is that larger companies with lower financial performance and lower leverage ratio are more inclined towards tax avoidance. The geographical region and the industry sector in which companies operate in are also determining their tax avoidant-behaviour. Surprisingly, the fiscal regulations amended starting with 2016 did not lead to an apparent exacerbation of tax avoidance among profit tax payers.

Determinantes da evasão fiscal em instituições financeiras: evidências do Brasil e dos Estados Unidos

O presente artigo analisa os determinantes da evasão fiscal em instituições financeiras. Foram analisadas, inicialmente, 131 instituições financeiras brasileiras e 2.886 instituições financeiras americanas do período de 2008 a 2017, perfazendo 28.590 observações. Foram calculadas as duas principais métricas de agressividade fiscal presentes na literatura nacional e internacional (Book-Tax Differences - BTD e Cash ETR). Utilizaram-se quatro estratégias econométricas: Método dos Mínimos Quadrados (MQO), Efeitos Fixos, Efeitos Aleatórios e Método Generalizado de Momentos Sistêmico (GMM-Sis). Foi constatado que para a amostra do Brasil, há algumas evidências de que intangíveis, tamanho e retorno sobre ativos (ROA) são alguns determinantes da evasão fiscal . Para a amostra dos Estados Unidos verificou que há algumas evidências de que tamanho e débitos totais são alguns determinantesda evasão fiscal. Um determinante em comum nas duas amostras é o tamanho. Esse resultado está alinhado com a literatura que prevê que empresas maiores têm mais condições de praticar evasão fiscal. Este estudo contribui para maior compreensão das práticas de planejamento tributário realizadas pelas empresas financeiras.

How Reliably Do Empirical Tests Identify Tax Avoidance?

ABSTRACTResearch on the determinants of tax avoidance have relied on tests using GAAP and cash effective tax rates (ETRs) and total and permanent book‐tax differences. Two new proxies have emerged that overcome documented limitations of these proxies: one, developed by Henry and Sansing (2018), allows for more meaningful interpretation of results estimated in samples that include loss observations. The other, reserves for unrecognized tax benefits (UTB), provides new data on tax uncertainty. We offer empirical evidence on how well tests using these new proxies perform relative to those extensively used in prior research. The paper finds that tests using the proxy developed by Henry and Sansing (2018) have lower power relative to those using other proxies across all samples, including a sample that includes loss observations. In contrast, when firms accrue reserves for uncertain tax avoidance, tests using the current‐year addition to the UTB have the highest power across all proxies, samples, and levels of reserves. In the absence of reserves, tests using the GAAP ETR best detect uncertain tax avoidance, on average. This study contributes to the literature by using a controlled environment to provide the first large‐scale empirical evidence on how the power of tests varies with the use of relatively new proxies, the inclusion of loss observations, and the advent of FIN 48.

Corporate Governance and Leverage on Tax Aggressiveness: Empirical Study on Mining Companies in Indonesia

This study aims to investigate the effect of corporate governance and leverage towards tax aggressiveness. The research data comprises 66 firm-year obtained from 11 mining companies during 2013-2018. They were sorted using a purposive sampling method. The hypotheses were tested using multiple regression analysis. The results indicate that institutional ownership and audit committee had a positive and significant effect on tax aggressiveness, the proportion of independent commissioners and audit quality had a negative and significant effect on tax avoidance, while leverage was not considered as a determinant of tax avoidance in Indonesian manufacturing firms.

Determinants of tax avoidance: Evidence from Indonesian mining industry

Tax avoidance is one of the company strategies to alleviate the company's tax burden by minimizing the amount of tax that must be paid legally. The mining sector is the most vulnerable sector to practice tax avoidance because this sector gains large profits from the mining activities carried out. This study aims to empirically examine the influences of executive incentive, corporate risk, corporate governance, and accounting conservatism on tax avoidance. The research population of this study was mining companies listed in the Indonesia Stock Exchange (IDX) from 2012 to 2017 as many as 41 companies. These research samples were 5 companies or 30 observation data selected by purposive sampling method. The data used is secondary data which is then analyzed using multiple regression. The result of the research showed that audit quality and accounting conservatism had negatively significant effects on tax avoidance. Meanwhile, executive incentive, corporate risk, institutional ownership, independent commissioners, and audit committee did not effect on tax avoidance.

National Culture and Tax Avoidance of Multinational Corporations

This study tests the role of national culture in tax avoidance by multinational corporations (MNCs). Hofstede’s four cultural dimensions are used to measure cultural differences across countries: uncertainty avoidance, individualism, masculinity, and power distance. The empirical results of the study imply that MNCs headquartered in countries with low uncertainty avoidance, low individualism, high masculinity, and low power distance engage in a higher level of tax avoidance than MNCs in countries with high uncertainty avoidance, high individualism, low masculinity, and high power distance. In addition, the cultural features of the parent company generally have a stronger influence on group-level tax avoidance than those of its subsidiaries. This study contributes to the literature by presenting empirical evidence of culture as a determinant of tax avoidance by MNCs.

Nontax Country Characteristics and Tax Avoidance

This study tests the role of national culture in tax avoidance by multinational corporations (MNCs). Hofstede’s four cultural dimensions are used to measure cultural differences across countries: uncertainty avoidance, individualism, masculinity, and power distance. The level of tax avoidance is estimated based on the worldwide effective tax rate (ETR) of corporate groups. A sample of group years domiciled in 31 countries for the years 2008 to 2015 is used to test the association between culture and tax avoidance. The empirical results of the study imply that MNCs headquartered in countries with low uncertainty avoidance, low individualism, high masculinity, and low power distance engage in a higher level of tax avoidance than MNCs in countries with high uncertainty avoidance, high individualism, low masculinity, and high power distance. In addition, the cultural features of the parent company generally have a stronger influence on group-level tax avoidance than those of its subsidiaries. This study contributes to the literature by presenting empirical evidence of culture as a determinant of tax avoidance by MNCs. The study also suggests that policymakers consider cultural factors when setting anti-avoidance regulations for MNCs.

The Determinants of Tax Avoidance within Corporate Groups: Evidence from Moroccan Groups

This paper examines the major tax avoidance determinants within the corporate groups, based on a hand-collected sample of 45 publicly-listed Moroccan corporate groups, over the 2011–2015 period. The literature review indicate that there are several practices of Moroccan corporate groups, used to reduce their tax liabilities, specially, we find, Group size, Intra-group transactions, Profitability, Intangible Assets, Debts, and Multinationality. Finally, our regression results show that only the multinationality, intra-group transactions and Debts are used to maximize tax avoidance opportunities, therefore to reduce the group’s tax liabilities.