Level Of Tax Aggressiveness Research Articles

Tax Planning And Tax Aggressiveness Before And After The Implementation Of Psak 73 (Study On Service Companies In The Retail Trade And Financing Subsectors For The 2017-2022 Period)

This research will provide knowledge regarding tax planning and tax aggressiveness before and after the implementation of PSAK 73. The population used in this research is service sector companies with retail trade & financing company subsectors that have gone public information and are listed on the Stock Exchange. Indonesian Securities (BEI). This research uses data analysis methods including descriptive statistical analysis, normality testing, and hypothesis testing. This test was tested using the Microsoft Excel application and the Statistical Package for the Social Sciences (SPSS) software version 27. The results of the research show that Tax Planning has improved: Implementation of PSAK 73 has had a significant impact on tax planning behavior in retail trade and financing services companies and The research results also show that there is a significant difference in the level of tax aggressiveness before and after the implementation of PSAK 73.

INFLUENCE OF THE LEVEL OF TAX AGGRESSIVENESS ON THE PROFITABILITY OF PUBLICLY TRADED COMPANIES OF INDUSTRIAL GOODS LISTED ON B3

Tax aggressiveness represents the most advantageous legal method of taxation chosen by taxpayers, after exploring the ambiguities and uncertainties contained in the tax legislation. In this sense, this study aims to verify the influence of the tax aggressiveness level on the profitability of publicly traded companies of industrial goods listed on B3 (Brazilian Stock Market) in the period from 2010 to 2019. The information was collected in the Economatica@ database and 52 companies were analyzed by means of multiple and quantile regressions. The results pointed out, based on the mean functions of the MQO method, that the level of tax aggressiveness does not influence the profitability. However, when considering the conditional quantile functions of the MEA method, the GAAP ETR starts to present statistical significance and negative coefficient as expected for the Q50 and Q75 quintiles of NM (Net Margin), ROA (Return on Assets) and ROE (Return on Equity) and for the Q90 quintile of NM and ROA and then, the hypotheses H1a, H1b and H1d that the tax aggressiveness level positively influences the NM, the ROA and the ROE of the investigated companies are not rejected. Having said that, in general, it is concluded that the higher the tax aggressiveness the higher the profitability of the publicly traded companies of industrial goods listed on B3 and that, even with issues not fully resolved, the theme can be very useful for various users of accounting information, such as tax legislators, regulators, investors, company directors and academic researchers.

The Effect of Profit Behavior and Tax Aggressiveness After The Impelementation of PSAK 73: Literature Review

This article aims to present a literature review related to research that discusses the impact of the implementation of PSAK 73, especially on profit behavior and tax aggressiveness. PSAK 73 is a new regulation that was implemented effectively on January 1, 2020, so this change is still a hot issue to be discussed. This literature review contains articles from 2018 to 2023. This article shows that there are still differences in results related to profit behavior, which shows an increase and decrease in profits. Meanwhile, for tax aggressiveness behavior some studies show influence and some show no effect on the level of tax aggressiveness.

AGRESIVITAS PAJAK DAN MANAJEMEN LABA PADA SAAT PERUBAHAN TARIF PAJAK PENGHASILAN BADAN

This study aims to see whether there are differences in the level of tax aggressiveness and earnings management after the enactment of Law No. 2 of 2020. Tax aggressiveness is measured by current ETR and earnings management is measured by the Modified Jones Model. The location of this research was conducted at the Indonesia Stock Exchange. Companies listed on the LQ-45 index are the sample in this study. The analytical technique used is the Wilcoxon statistical test. The results showed that there are differences in tax aggressiveness before and after tax rate changes for corporate taxpayers based on Law No. 2 of 2020. Unlike the result of tax aggressiveness, there is no significant difference in the application of earnings management before and after tax rate changes for corporate taxpayers based on Law No. 2 of 2020.

The Effect of Leverage, Liquidity and Firm Size on Tax Aggressiveness

Tax aggressiveness occurs when businesses apply various tax techniques to lower the amount of tax payable. This study aims to analyze the influence of such factors as leverage, liquidity, and firm size on the tax aggressiveness of companies in the building and construction industry. The level of tax aggressiveness is measured using the effective tax rate. The leverage indicator is presented by a debt-to-equity ratio, which shows the part of the total amount of funds used to pay the debt. The liquidity indicator is presented by a current ratio, which shows the company's ability to settle short-term obligations or debts that must be paid off when due. The firm size is defined as the natural logarithm of the company's total assets. The data for this study were obtained from the audited financial statements of the companies listed on the Indonesia Stock Exchange (IDX). The research sample covers 21 construction and building subsector companies. The research period lasted from 2020 to 2022, and 63 observation data were collected. For data analysis, the method used is Partial Least Square (PLS). The findings indicate that leverage and firm size do not significantly impact tax aggressiveness. Conversely, liquidity positively and significantly impacts tax aggressiveness. At the same time, the variables selected for this study explain only 15.5% of the variability of tax aggressiveness. This means that this study does not cover many other factors influencing a company's decision to optimize tax. Companies must conduct tax policy in compliance with legislation, which is one of the elements of the social responsibility of business. Although tax aggressiveness can provide short-term benefits, companies must consider potential reputational risks and long-term impacts. Transparency and compliance with tax regulations can also reduce the risk of conflict with tax authorities.

Tax Aggressiveness in Consumer Goods: Liquidity, Leverage, Earnings, and CSR Dynamics

This study explores the relationship between liquidity, leverage, earnings management, corporate social responsibility (CSR), and tax aggressiveness in the consumer goods manufacturing companies listed on the Indonesia Stock Exchange from 2015 to 2019. Employing purposive sampling and panel data regression analysis on secondary data from financial reports, the research aims to assess the individual and combined effects of these factors. The findings reveal that leverage and CSR exhibit a significant negative impact on tax aggressiveness, while liquidity demonstrates a negative effect. Moreover, earnings management is positively associated with tax aggressiveness, albeit not significantly. Simultaneously, the comprehensive analysis reveals that liquidity, leverage, earnings management, and CSR collectively influence tax aggressiveness. These findings provide valuable insights into the interplay between financial and non-financial factors in shaping tax strategies adopted by manufacturing firms, enabling policymakers, practitioners, and scholars to better understand and manage tax behavior in the corporate sector.
 Highlights:
 
 
 Liquidity and Leverage: The study reveals the negative impact of liquidity and leverage on tax aggressiveness, indicating that companies with higher liquidity and lower leverage tend to exhibit less aggressive tax behavior.
 
 
 Corporate Social Responsibility: The findings demonstrate that corporate social responsibility practices have a significant negative effect on tax aggressiveness, suggesting that socially responsible companies are less likely to engage in aggressive tax strategies.
 
 
 Earnings Management: While not significant, the positive association between earnings management and tax aggressiveness highlights the need for further examination of the complex relationship between financial reporting practices and tax behavior in manufacturing companies.
 
 
 Keywords: Tax Aggressiveness, Liquidity, Leverage, Earnings Management, Manajemen Laba, Corporate Social Responsibility

Private firms’ tax aggressiveness and lightweight pre-tax-audit interventions by the tax administration

This study examines private companies’ tax aggressiveness and its changes in response to interventions by the government tax administration. While scholars have researched authorities’ interventions extensively, this study is the first to consider the “light” technique of tax adjustments made by the tax administration immediately after the firm submits its tax return. We utilized a large-scale proprietary dataset obtained from Finland’s tax administration (covering 85,155 firm–years), the hypotheses addressed the relationship between the firm’s level of tax aggressiveness and the tax-administration intervention (H1) and that between the intervention and companies’ response to it (H2). The empirical findings support both hypotheses. Its lightweight nature notwithstanding, the pre-tax-audit intervention can serve as a tool for ameliorating firms’ overly tax-aggressive behavior. Finally, we present management implications that should be of interest to tax administrations and regulatory authorities, related to the potential effectiveness of a tax administration’s monitoring processes in mitigating the tax aggressiveness of private companies.

The influence of audit committee on the relationship between corporate social responsibility disclosure and tax aggressiveness: evidence from French context

The objective of this study is to investigate the impact of audit committee characteristics on the relationship between corporate social responsibility disclosure and tax aggressiveness. Based on 72 French listed firms SBF 120 for the years ranging 2010 to 2017.The level of tax aggressiveness is measured across the effective tax rate (ETR). The authors find that measures of independent, expertise and size of audit committee are significantly related to tax aggressiveness. This research contribution to the literature reveals the influence of audit committee characteristics on the Relationship between corporate social responsibility disclosure and the level of tax aggressiveness in French context given that in recent years, the fight against aggressive tax practices has been among the primary objectives within the framework of the European Union (EU).

Board's characteristics, ownership's nature and corporate tax aggressiveness: new evidence from the Tunisian context

PurposeThis study sheds light on the determinants related to the corporate board of directors and the firms’ ownership nature of tax aggressiveness strategies of Tunisian listed firms and what could be their effect on its level in a postrevolution context.Design/methodology/approachOur research considers only nonfinancial firms listed in the Tunisian stock exchange during the 2011–2017 period. It is based on unbalanced panel data.FindingsFindings suggest that women presence on the corporate board, CEO duality, the managerial and institutional ownership regularize significantly the level and the management's behavior of engagement in tax aggressiveness practices and reduce the firm’s overall risks of its consequences in terms of tax positions stability.Research limitations/implicationsOur investigation considers only nonfinancial firms to avoid noisy results and for the significant differences between accounting standards within financial and nonfinancial firms, besides sample homogeneity and comparability considerations.Practical implicationsThis study provides evidence that some governance mechanisms, even reasonably dedicated to consider the risk of tax aggressiveness and to prevent its consequences, have a paradoxical effect and amplify the tax aggressiveness’ level rather than defending the firm’s viability and its financial stability. It offers signals to managers about specific governance attributes that strengthen and/or control the extent of tax aggressive strategies.Social implicationsThis research gives a particular road map for society, investors and practitioners to depict the firms’ level of tax aggressiveness and especially to understand its attributes related to the corporate board of directors and the ownership's nature through evidences from a postrevolution context.Originality/valueOur research contributes to prior literature by examining the effect of corporate board characteristics and different ownership natures on the extent of tax aggressiveness during and after the revolution period in Tunisia and confirms and infers some prior findings of tax aggressive determinants in underdevelopment context.

Determinant of Tax Aggressiveness and Relationship with Firm Value (Empirical Study Company Listed Go-Public in Indonesia Stock Exchange)

This study aims to determine the effect of liquidity, profitability, and solvability on the level of tax aggressiveness with firm value as a control variable. Total sample was 86 non-financial company that implicate tax aggressiveness in Indonesia Stock Exchange (IDX), with purposive sampling, with cross section data period 2007 to 2017. This study using agency theory and signaling theory as the grand theory. The data were analyzed using Structural Equation Modeling- Partial Least Square (SEM-PLS). This study uses a SmartPLS 3.0 and must pass outer and inner criteria. The reason why the author choose SmartPLS is because this application program can explain each indicator of the variable, so will be easy to evaluate which indicator that not have the correspondent affect with the dependend variable. The previous studies of ETR showed inconsistent results in various countries. Test results show that liquidity and profitability have a negative and significant influenced with tax aggressiveness. Solvability has a negative and not significant influenced on tax aggressiveness. Firm value has a positive and significant influenced on tax aggressiveness.

The Influence of Liquidity,Profitability,Intensity Inventory,Related Party Debt,And Company Size To Aggressive Tax Rate

This study aims to determine how much influence liquidity, profitability, inventory intensity, related party debt, and firm size on the level of tax aggressiveness. The sample used in this study were 34 manufacturing companies listed on the Indonesia Stock Exchange in the period 2013-2017. Samples were taken by purposive random sampling using certain criteria. Tax aggressiveness is measured by comparing the tax expense and net profit before tax. Liquidity is measured by comparing current assets with current debt. Profitability is measured by comparing net profit after tax and total assets. Inventory intensity is measured by comparing total inventory and total assets. Debt related parties are measured by comparing the amount of related party debt and total assets. Size Company is measured by doing natural market value logarithms. The results of the regression analysis indicate that liquidity, profitability, and firm size have a negative and significant effect on the level of tax aggressiveness. While inventory intensity has a positive and significant effect, but related party debt has no significant effect on the level of tax aggressiveness. Manufacturing companies that are relatively large, liquid, and have high profits often carry out tax aggressiveness by planning to reduce tax costs that must be paid.

Pengungkapan Corporate Social Responbility terhadap Tax Aggressiveness

The aim of this study is to examine the effect of corporate social responsibility (CSR) to corporate tax aggressiveness. The independent variable is used in this study is corporate social responsibility disclosure.While the dependent variable in this study is tax aggressiveness that measured using two effective tax rates measures. This study is a replication of and use 151 manufacturing companies that listed on the Indonesia Stock Exchange as the sample. Samples were selected by purposive sampling method and finally obtained 62 manufacturing companies per year that fulfill the criterias. Data were analyzed using ordinary least square regression analysis model. The result shows that the higher the level of CSR disclosure of a corporation, the higher is the level of tax aggressiveness.

Efeitos do Modelo de Fleuriet e Índices de Liquidez na Agressividade Tributária

Resumo A necessidade de capital de giro e o índice de liquidez influenciam na agressividade fiscal? O artigo investiga se o nível de agressividade fiscal se altera dependendo da estrutura financeira de uma empresa, tendo por base o Modelo Fleuriet para análise dinâmica do capital de giro. O planejamento tributário é uma forma de se obter recursos internamente e, de acordo com a Pecking Order Theory, os recursos internos são os primeiros utilizados pelas empresas para financiarem suas atividades. Um modelo de regressão linear múltipla para dados em painel com efeitos fixos de empresa e ano foi adotado para testar a relação. Como variáveis de interesse utilizaram-se variáveis dummy, uma para cada tipo de estrutura financeira proposta pelo Modelo Fleuriet. Em uma amostra composta por 2.142 empresas-ano listadas na B3 entre 2010 a 2016 verificou-se que, tanto nas empresas mais saudáveis quanto nas menos saudáveis, não há diferença significativa no nível de agressividade fiscal entre as empresas classificadas de acordo com as estruturas do Modelo Fleuriet. Porém as análises adicionais para o Índice de Liquidez Dinâmico e o Índice de Liquidez Geral mostraram que quanto maior a liquidez menor é a agressividade fiscal. Os achados apontam que uma maior agressividade fiscal pode ser explicada em parte por uma dificuldade de liquidez.

The Effect of Corporate Diversification on Tax Aggressiveness in Brazilian Companies

This research aims to verify whether firms that operate in several different business sectors are more tax aggressive in comparison to firms that operate in a single or a few segments. The study analyzes a sample of 4,280 firms/year, listed in the Brazilian stock exchange B3 in the period from 2010 to 2017. It was observed that most of the companies operate in one or two business segments. To verify the existence of a relationship between diversification and tax aggressiveness, we used a multiple linear regression model with fixed effect panel data for firm and year. Also, we used the logit model with binary response for the explanatory variable. Two measurements of tax aggressiveness were applied, the ETR (effective tax rate) and the ETR LONG (long-run effective tax rates). This type of research is an innovation in Brazil, not yet explored in the literature. The results showed that more diversified firms are more likely to be tax aggressive, in comparison to single-segment firms. Therefore, the results indicate that among Brazilian listed companies, there is a positive relationship between the number of segments in which they are listed and the level of tax aggressiveness. Among the main contributions of the research, we emphasize the better understanding of the phenomenon of tax aggressiveness, its causes and determinants, implications for information users (particularly tax regulators), and implications for the management that identifies a possible tax advantage in corporate diversification.

Tax Aggressiveness Prediction Method with Neural Network and Logistic Regression

This study aims to examine the predictive power of tax aggressiveness using neural network and logistic regression methods. This research sample is a company whose shares are listed in the Indonesian Sharia Stock Index (ISSI) in the period 2011-2015. A total of 71 public companies in Indonesia were obtained. Data obtained from Indonesia Stock Exchange. The technique of determining the sample was used purposive sampling. The independent variables used are maqashid sharia index, disclosure index of corporate social responsibility, company size, profitability, leverage, inventory intensity, and capital intensity. The analysis technique used is multiple regression, logistic regression, and neural networks. In the initial test, multiple regression method was used. At this initial stage, other independent variables will be known that can predict the level of tax aggressiveness. In the second stage of the test comparing the prediction model of tax aggressiveness that gives a higher level of accuracy between logistic regression analysis and neural network. Based on the results of the analysis and discussion, it can be concluded that the Neural Network method provides a better level of prediction than logistic regression for training data and testing data.

The Impact of Firm Characteristics on Corporate Tax Aggressiveness: A Study on Malaysian Public Listed Companies

The importance of taxes to governments worldwide is undeniable. Governments depend on their tax revenues, especially in ensuring sufficient provisions of public amenities to the society. However, their coffers are unceasingly threatened by tax aggressive behaviors, or aggressive actions to reduce tax burdens, especially by companies. Considering that the Malaysian government is highly reliant on its tax revenues, particularly its corporate income tax collections, this study’s purpose is to examine the impact of firm characteristics on the tax aggressiveness level of public listed companies in this country. This study uses fixed-effects panel regression analysis on 182 companies listed on the Main Market of Bursa Malaysia for the consecutive period from 2010 to 2012. The results identify that firm size, debt intensity, capital intensity, growth rate, and profitability have significant impacts on the level of tax aggressiveness of the companies tested. These findings imply that corporate tax behavior is indeed influenced by the companies’ very own characteristics. Therefore, this study’s findings compellingly suggest that firm characteristics should be adopted as a means in assessing the tax aggressive tendency of Malaysian corporate taxpayers.

Corporate governance, CEO compensation and tax aggressiveness

Purpose The purpose of this paper is to examine the effect of corporate governance structure and CEO compensation on the level of tax aggressiveness. Design/methodology/approach This work analyzes a sample of 471 observations of 100 companies listed on the NASDAQ 100 for the period 2008-2012. It uses a fixed-effect panel model to analyze the effect of different model variables on the tax aggressiveness level. Findings The main finding of this study is the great influence of corporate governance structure and CEO compensation on reducing tax aggressiveness. Indeed, it finds a significant negative relation between board size, CEO salary, CEO stock options and tax aggressiveness. In addition, the study reveals that there is a direct negative relation between CEO duality, tax fees and tax aggressiveness. Research limitations/implications The study was conducted using robust methods to test the effect of corporate governance structure and CEO compensation on tax aggressiveness level. The generalized least squares method was used to fit panel data and overcome heteroscedasticity and autocorrelation problems. The aim of the study was to prove the great effect of both corporate governance structure and CEO compensation on reducing tax aggressiveness. As this study was based on data from American companies, the results cannot be generalized to all contexts. Originality/value This paper differs from previous work and tests the effect of corporate governance structure, CEO compensation, CEO characteristics and audit fees on tax aggressiveness. The findings of this study will enrich the literature on tax aggressiveness by suggesting that corporate governance structure and CEO compensation can significantly limit tax aggressiveness behavior. Therefore, shareholders must be aware of these two variables. They need to limit tax aggressiveness behavior, as it is usually accompanied by rent diversion, as reported by Desai and Dharmapala (2006). Therefore, these findings will be helpful to investors, managers and regulators because they have implications for the interactive decision-making process.

Corporate Social Responsibility Disclosure, Environmental Performance, and Tax Aggressiveness

This study aims to examine the influence of the corporate taxpayers’ level of CSR disclosure and environmental performance on the level of tax aggressiveness. This study took a sample of non-financial companies listed on the Indonesian Stock Exchange during 2009-2012. This study shows that the corporate taxpayers’ level of CSR disclosure has significant negative effect towards the tax aggressiveness. It means the higher the level of the CSR disclosure, the lower the company’s tax aggressiveness. This study also proves that good environmental performance will strengthen the negative effect of CSR disclosure on tax aggressiveness. The assessment of environmental performance is conducted by the Ministry of Environment as independent party. It means that the higher the score of company’s environmental performance, the higher the commitment to pay taxes. This study supports the view that more socially responsible corporations are likely to be less tax aggressive. DOI : https://doi.org/10.21632/irjbs.9.2.93-104 Keywords: Corporate Social Responsibility Disclosure, Environmental Performance, Tax Aggressiveness

Corporate Social Responsibility Disclosure, Environmental Performance, and Tax Aggressiveness

This study aims to examine the influence of the corporate taxpayers’ level of CSR disclosure and environmental performance on the level of tax aggressiveness. This study took a sample of non-financial companies listed on the Indonesian Stock Exchange during 2009-2012. This study shows that the corporate taxpayers’ level of CSR disclosure has significant negative effect towards the tax aggressiveness. It means the higher the level of the CSR disclosure, the lower the company’s tax aggressiveness. This study also proves that good environmental performance will strengthen the negative effect of CSR disclosure on tax aggressiveness. The assessment of environmental performance is conducted by the Ministry of Environment as independent party. It means that the higher the score of company’s environmental performance, the higher the commitment to pay taxes. This study supports the view that more socially responsible corporations are likely to be less tax aggressive. DOI : https://doi.org/10.21632/irjbs.9.2.93-104 Keywords: Corporate Social Responsibility Disclosure, Environmental Performance, Tax Aggressiveness

Corporate Social Responsibility and Tax Aggressiveness

This study examines the association between corporate social responsibility and corporate tax aggressiveness. Based on a sample of 408 publicly listed Australian corporations for the 2008/2009 financial year, our regression results indicate that the higher the level of corporate social responsibility disclosure of a corporation, the lower is the level of tax aggressiveness. We find a negative and statistically significant association between corporate social responsibility disclosure and tax aggressiveness which holds across a number of different regression model specifications. Accordingly, our results show that more socially responsible corporations are likely to deter tax aggressive activities. Finally, the regression results from our additional analysis indicate that the social investment commitment, and corporate and CSR strategy (including the ethics and business conduct) of a corporation are important elements of CSR activities that have a negative impact on tax aggressiveness.