Non-debt Tax Shield Research Articles

INTERNAL DETERMINAN STRUKTUR MODAL PADA PERUSAHAAN TAMBANG BATUBARA DI BURSA EFEK INDONESIA

Companies in carrying out operations and developing business certainly require capital and additional capital. The purpose of this study was to determine the internal determinants of capital structure. This research was conducted on coal mining sub-sector companies on the Indonesia Stock Exchange for the period 2016 – 2020. In this study, five independent variables were used, namely profitability, company size, liquidity, non-debt tax shield, and company growth, while the dependent variable was structure capital. The sample used was determined by purposive sampling method and obtained 22 companies as a sample of a total of 24 listed companies. The data in this study were collected using the non-participant observation method by making observations on the company's financial statements. The data analysis technique used is multiple linear regression analysis. The results of multiple linear regression analysis show that profitability and liquidity have a significant negative effect on capital structure, firm size and firm growth have a significant positive effect on capital structure, but the non-debt tax shield variable does not have a negative effect on capital structure.

Corporate Tax Saving Strategy and Share Price Performance

This study ascertained how corporate tax saving strategy affect share price performance. It examined how debt tax shield, non-debt tax shield, and effective tax rate affect share price performance. The secondary source of data collection was adopted in the study where the purposive sampling technique was used to select a sample size of twelve (12) listed industrial goods firms in Nigeria. Ordinary Least Square regression analysis was used in this study and the findings revealed that non-debt tax shield has significant effect on share price performance of listed industrial goods firms in Nigeria and that effective tax rate has significant effect on share price performance of listed industrial goods firms in Nigeria. The study concluded that crucial component of fiscal policy that has a great impact on both the social and economic development of a nation, hence, tax savings demands attention from managers at all levels of management. The study recommended that Nigerian government needs subsidize cost of debt-financing for the companies operating in the country’s capital market and that stakeholders should develop the financial markets and make it accessible for firms to obtain long-term financing for economic growth and development.

Revisiting the puzzle of capital structure determinants: an empirical study based on UK firms

PurposeThis study aims to measure impact of several firm-specific factors on alternative measures of leverage. The authors also aim to study impact of the subprime crisis on such associations.Design/methodology/approachThe authors utilized an unbalanced panel data of 973 firm-year observations on 47 UK listed non-financial firms for the years 1990–2019. Book-based and market-based long-term and total leverage measures have been used as explained variables. The explanatory variables are profitability, size, two measures of growth, asset tangibility, non-debt tax shields, firm age and product uniqueness. Fixed effect and random effect models with clustered robust standard errors have been utilized for data analysis. To find the effect of subprime crisis, original dataset was split to create pre-crisis and post-crisis datasets.FindingsThe authors find that profitability significantly reduces leverage while firms having more tangible assets use significantly more debt in capital structure. Firm size and non-debt tax shield have statistically insignificant positive impact on leverage. Having more unique products reduces use of external debt, albeit insignificantly. Growth, when measured as market-to-book ratio, has inconsistent impact, whereas capital expenditure insignificantly reduces leverage. Age is found to be an insignificant predictor of leverage. After the subprime crisis, firms started relying more on internal fund instead of external debt, more particularly short-term debt. Having more collateral is gradually becoming more important for availing external debt.Research limitations/implicationsData limitations restrict generalization of the findings.Originality/valueThis is one of the pioneering attempts to show how subprime crisis altered the theoretical domain of capital structure research in the UK.

Are shariah and non-shariah firms’ capital structure determinants and financial performance related? Evidence from Malaysia

This comparative analysis is an attempt to explore the core differences among the capital structure determinants of Malaysian Shariah and non-Shariah firms. Besides, this investigation also explores which financial category in Malaysia, either Shariah or non-Shariah, maintained its performance, i.e., earnings; during the peak period of the COVID-19 pandemic and to what extent their performance is related. For analysis purposes, this investigation used 454 firms’ 17 years’ financial data, i.e., 2005-2021. The Panel Data Static models are executed to perform the empirical investigation. The debt-to-equity ratio is selected as a dependent variable, whereas total assets, sales, current assets, growth, return on equity, non-debt tax shield, and earnings per share are nominated as independent variables. The results indicate that fixed assets and growth are core determinants for both types of firms. This endorses the validity of these two investigated determinants for the whole Malaysian firm. Moreover, current assets, non-debt tax shield, fixed assets, growth, and earnings per share are also observed as main and significant determinants for Shariah-tagged firms. The positive significance of tangibility, non-debt tax shield, and liquidity explain why the Trade-off theory is more dominant in the Malaysian context. Besides, the outcomes obtained from descriptive statistics and Independent Two-sample t Test explain that both financial categories of Malaysian listed firms maintained negative earnings during the COVID-19 peak period, i.e., 2020. The results will help policymakers devise the best financing model i.e., Shariah and non-Shariah, specifically during the uncertain financial fiascos.

Pengaruh Likuiditas, Tangibility dan Non Debt Tax Shield Terhadap Struktur Modal

This research was conducted to determine the effect of liquidity, tangibility, and non-debt tax shield on capital structure with institutional ownership as a moderator in manufacturing companies listed on the IDX for the 2017-2021 period. The sample used in this research was selected using a purposive sampling method based on several predetermined criteria and resulted in 12 company samples with 60 observation data. The data analysis method uses panel data regression analysis which is tested using Eviews 12 software. The hypothesis testing method uses a significance level of 5%. The research results show that only the non-debt tax shield variable is proven to have a negative effect on capital structure, while the profitability, liquidity and tangibility variables have no effect on capital structure. Institutional ownership is able to increase the effect of non-debt tax shield on capital structure. Institutional ownership is unable to moderate the influence of profitability, liquidity, tangibility on capital structure.

ANALISIS FAKTOR PENENTU PERFORMA PERUSAHAAN MANUFAKTUR YANG TERCATAT BEI TAHUN 2017-2020

The purpose of this research is to obtain empirical evidence on the influence of leverage, asset structure, liquidity, company size, non-debt tax shields, and managerial ownership of the performance of manufacturing companies listed on the Indonesia Stock Exchange for the period 2017-2020. Sampling in this study used purposive sampling methods and obtained 48 samples of manufacturing companies listed on the Indonesia Stock Exchange for the period 2017-2020. The study used the Eviews 12 and Microsoft Excel 2016 software programs to manage data. The results of this study showed that leverage and asset structure had a negative influence on the company's performance, liquidity and non-debt tax shields had no negative influence on the company's performance while the size of the company and managerial ownership did not have a positive influence on the company's performance. The implication of this research is the need to reduce the use of debt to minimize the interest expense of the debt which will increase the company's profit so as to improve the company's performance which will provide good information for investors.

PENGARUH ASSET TANGIBILITY, PROFITABILITAS, PERTUMBUHAN PERUSAHAAN DAN LIKUIDITAS TERHADAP STRUKTUR MODAL

The purpose of this study is to provide empirical evidence on the impact of asset tangibility, profitability, growth and liquidity on the capital structure in manufacturing industry companies listed in Indonesian Stock Exchange during the period of 2018-2020. In this research, samples used of 74 manufacturing companies for three years were selected previously using the purposive sampling mtehod. Secondary Data were used in this research which is in the form of financial information from financial statement. Data was processed by eviews 12. The results of this study shows that asset tangibility, profitability, and growth have a significant effect on capital structure. Suggestion that can be given for next research it is expected to use other independent variables such as company size, non-debt tax shield, company age that might show better result.

Pengaruh Profitability, Non-Debt Tax Shield, Growth Opportunity, Corporate Tax Rate Terhadap Capital Structure Pada Perusahaan Manufaktur Yang Terindeks BEI Periode 2018-2022

This study aims to examine the effect of profitability, non-debt tax shield, growth opportunity, coprporate tax rate on capital structure. The population in this study are manufacturing companies listed on the Indonesian Stock Exchange (BEI). With 115 samples selected using purposive sampling techniques.This study uses multiple linear regression models. The results of the study indicate that Profitability has no effect on Capital Structure. Non-Debt Tax Shield has no effect on Capital Structure. Growth Opportunities have a positive effect on Capital Structure. Corporate Tax Rate has no effect on Capital Structure

Sales Growth, Company Size, Profitability, and Non-Debt Tax Shield on Capital Structure In Food and Beverage Sub-Sector Companies Listed on The Indonesia Stock Exchange

This study aims to determine the effect of sales growth, company size, profitability, and non-debt tax shield on the capital structure of food and beverage sub-sector consumption companies listed on the Indonesia Stock Exchange for the 2017-2020 period. This study used secondary data. The sampling technique in this study used purposive sampling. The number of samples obtained amounted to 38 companies. Data analysis in this study used quantitative descriptive and several calculations using the SmartPLS software. From this study, it can be concluded that only the non-debt tax shield significantly affects capital structure. While sales growth, company size, and profitability do not have a significant effect on capital structure.

Inspecting sector-specific capital structure determinants: The case of Malaysian Shariah firms

This study is set to inspect sector-specific capital structure determinants for publicly listed Malaysian Shariah-tagged firms. For this purpose, a 17-year data sample set comprising 343 Shariah firms in Bursa Malaysia’s main market is constructed. The seven key determinants, namely fixed assets, non-debt tax shield, current assets, growth, return on equity, size, and earnings per share, are measured as capital structure determinants in relation to the debt-equity ratio. Deploying a Dynamic Panel Data Model via an efficient econometric assessor, i.e., Generalized Method of Moments, the investigation exposes that current and fixed assets are observed as the key significant sector-specific capital structure determinants for Malaysian Shariah-tagged firms. Also, the positive and significant lagged dependent variables of each studied sector indicate the presence of a targeted capital structure and Speed of Adjustment (SOA). The occurrence of SOA explains variations in the debt-equity choices of Malaysian Shariah firms at the sector level. The significant tangibility and liquidity in most sectors and the significant lagged dependent variables across all sectors directly suggest the significance of the dynamic theory of Trade-Off. As a whole, it is observed that the sector-level capital structure framing practices of Shariah-tagged firms are not similar. This study aims to investigate the optimal debt-equity mix for listed Malaysian Shariah-complaint enterprises operating in diverse sectors. The observed outcomes are the baseline for policymakers to formulate a better financing model that supports Malaysian Shariah firms to maintain a dynamic or targeted capital structure at all times.

CHIEF EXECUTIVE OFFICER (CEO) ATTRIBUTES AND TAX AVOIDANCE INSIGHT FROM LISTED NON-FINANCIAL FIRMS IN NIGERIA

The study mainly examined the effect of chief executive officers’ attribute on tax avoidance of listed non-financial firms in Nigeria. To achieve this objective, this study specifically tests the hypothesis that chief executive officers’ attributes in the context of chief executive officers’ tenure, chief executive officers’ ownership, chief executive officers’ gender and chief executive officers’ nationality significantly affects tax avoidance over a 10year time frame (2012 – 2021) for non-financial listed firms in Nigeria. This study is anchored on the Upper Echelon Theory noting that the key concept of the upper echelon theory is that the company reflects its chief executive officer. Robust regression analysis technique was employed to test the formulated hypotheses after fulfilling the necessary conditions for obtaining non-spurious regression estimates. Specifically, the result reveals mixed evidence suggesting that the effect of chief executive officers’ attribute on tax avoidance depends on the observed or unobserved traits. Particularly, the result suggests that higher ownership rights owned by the chief executive officer reduces the level of tax avoidance of listed non-finance firms in Nigeria. Therefore, this study recommends among others that to optimize the non-debt tax saving strategy, management must develop a culture within the organization that values responsible tax planning and encourages chief executive officers’ to actively consider the non-debt tax shield as a strategic tool. Further, management team should promote transparency and open communication about tax strategies, ensuring that tax planning is integrated into overall business decision-making processes.
 Keywords: Chief Executive Officer Attribute, Tax Avoidance, Robust Regression, Upper Echelon Theory.

The Determinant Factors of Capital Structure in Cyclical Sector: Empirical Study from Indonesia

This study aims to test seven internal factors determining capital structure using trade-off theory in the consumer cyclical sector in Indonesia. The research sample used a purposive sampling of 15 companies with 225 observations. Generalized Method of Moment analysis method for panel data. The research found that significant firm growth and size were proven. Tangible assets, non-debt tax shield, growth opportunity, and significant earning volume were not proven, and profitability was not significant. Investors can make the right decisions regarding ownership of company shares to sell or buy. In addition, potential investors can invest their funds by considering the company's high debt costs, which results in financial distress costs. The findings provide an overview for company managers in making decisions to achieve an optimal capital structure.

DETERMINANTS OF DEBT POLICY IN CONSUMER GOODS COMPANY IN INDONESIA

The intended of this study was to determine the effect of business risk, non-debt tax shields, and firm size on debt policy. The population consists of companies that in the 2019-2021 period are listed on the Stock Exchange in the consumer goods group. Purposive sampling technique was applied to select samples from as many as 74 companies, of which 40 consumer goods companies met the criteria, so that in total there were 120 research data. Data analysis was carried out using Multiple Linear Regression and data processing data is supported by EViews 12. The findings of this research show that changes in company size will move debt policy in a significant and positive direction. Meanwhile, business risk and nonndebt taxxshields have insignificant effect on debttpolicy for companies in the consumerrgoods group registered on the Indonesia StockkExchange.

Debt-Equity Variations and Determinants: Empirical Study of Quoted Firms in Nigeria

This study investigates debt-equity variations and determinants with reference to quoted firms in Nigeria for the period 2009 to 2018. The major objective of the study is to ascertain the factors that influence the change in debt-equity. The data used is from fifteen listed firms in Nigeria, Preliminary analysis showed that income volatility, interest payment, asset tangibility, firm size and non-debt tax shield have high correlation with change in debt-equity ratio. All the independent variables are positively related to change in debt-equity ratio except income volatility. The panel unit root test showed that the data were all stationary at first differencing. The major findings indicated a positive and significant relationship between asset tangibility, firm size and change in debt-equity ratio of the selected firms. Interest payment and non-debt tax shield increased change in debt-equity ratio but insignificant, while income volatility showed a negative and insignificant effect on change in debt-equity ratio. The study recommends the need for quoted firms in Nigeria to provide quality management in various areas of the businesses activities to ensure the stability of income, without which can cause numerous business.

Country-Specific Factors and Capital Structure of the Oil and Gas Industry: A Review

Determinants of the capital structure still confusing among scholars. While numerous studies have been conducted, these are often limited to firm-specific factors such as profitability, asset tangibility, growth opportunities, liquidity, size, and non-debt tax shield. However, the literature clearly points out that there are important country-specific factors that determine capital structure decisions. Arguably, studies on determinants of capital structure focusing on country-specific factors for the oil and gas industry are still missing in the literature. As such, this study serves to review the determinants of capital structure with a specific focus on country-specific factors for the oil and gas industry. This study is to provide potential avenues for future researchers specifically in the oil and gas industry.

Effect of Determinants on Financial Leverage in FMCG Industry: An Empirical Study of Capital Structure Prior to COVID-19

FMCG stands for fast-moving consumer goods industry, also known as consumer packaged goods, which refers to an industry engaged in the production of packaged food, cosmetics, household goods and other readily consumable items. This industry’s main characteristics reveal frequent purchases by consumers, high inventory turnover and a short shelf life. The FMCG industry is the fourth-largest sector in the Indian economy. This study is aimed at understanding the capital structure financing and investigating the relationship between the capital structure determinants and financial leverage of NIFTY FMCG companies from the year 2000 to 2018, prior to the COVID-19 breakdown health emergency. It has been stated in the World Bank report for 2019 that India is the seventh largest consumer market in the world, which includes elements like private consumption, investments and exports, thus encouraging the study of the capital structure of FMCG companies to be conducted. It is postulated that the capital structure determinants are profitability, growth opportunity, size, risk, non-debt tax shield, liquidity and asset structure. It is believed that liquidity is expected to play an important role as a capital structure determinant. Thus, an approach is developed to investigate the impact of capital structure determinants on the debt ratio of FMCG firms in the light of capital structure theories.

Trade Off and Pecking Order Capital Structure Theories in Tourism Sector in the Portuguese Central Region

The present study aims to identify the predominant theory in financing decisions, and which are the determinants of the capital structure of small and medium enterprises (SMEs) of the tourism sector in the Central Region of Portugal. The statistical method applied was the econometric model of linear regression, using a sample of 606 SMEs in the tourism sector in the Central Region, for a period of analysis between 2011 and 2018. The focus on the tourism sector is due to its importance in the Portuguese economy and to the existence of few studies, particularly in the Central Region. In the analysis of the determinants of capital structure decisions we used as explanatory variables profitability, asset tangibility, size, total liquidity, other non-debt tax shields, risk and age of SMEs. The results obtained suggest that the capital structure decisions follow more closely the assumptions of the Pecking Order theory but may also follow the assumptions of the Trade-Off theory. Therefore, this paper enhances that Trade-Off and Pecking Order Theories are not mutually exclusive in explaining the capital structure decisions of SMEs. We may conclude that SMEs firstly finance themselves with retained earnings, then use external financing and finally resort to capital increases. Keywords: determinants of capital structure, SMEs, tourism sector, pecking order theory, trade-off theory

E Determinants of Capital Structure for The Coal-Mining Companies Listed on Indonesia Stock Exchange

The purpose of this research is to explain the effect of profitability, asset structure, growth opportunities, and non-debt tax shields on the capital structure of the coal-mining firms indexed on the Indonesia Stock Exchange from 2016 to 2020. There are 12 company samples in this research, which was determined with the purposive sampling method. The series of tests that will be carried out in this study include descriptive statistical analysis, panel data regression model tests, classical assumption tests, multiple linear regression analysis, and hypothesis testing. The data are processed using the EViews 12 software. The outcomes of this study show that profitability (ROA) and non-debt tax shields (NDTS) are affecting the capital structure (DER) negatively and significantly, growth opportunities (MTB) is affecting the capital structure (DER) positively and significantly, while asset structure (TANG) does not affect the capital structure significantly.

E Determinants of Capital Structure for The Coal-Mining Companies Listed on Indonesia Stock Exchange

The purpose of this research is to explain the effect of profitability, asset structure, growth opportunities, and non-debt tax shields on the capital structure of the coal-mining firms indexed on the Indonesia Stock Exchange from 2016 to 2020. There are 12 company samples in this research, which was determined with the purposive sampling method. The series of tests that will be carried out in this study include descriptive statistical analysis, panel data regression model tests, classical assumption tests, multiple linear regression analysis, and hypothesis testing. The data are processed using the EViews 12 software. The outcomes of this study show that profitability (ROA) and non-debt tax shields (NDTS) are affecting the capital structure (DER) negatively and significantly, growth opportunities (MTB) is affecting the capital structure (DER) positively and significantly, while asset structure (TANG) does not affect the capital structure significantly.

E Determinants of Capital Structure for The Coal-Mining Companies Listed on Indonesia Stock Exchange

The purpose of this research is to explain the effect of profitability, asset structure, growth opportunities, and non-debt tax shields on the capital structure of the coal-mining firms indexed on the Indonesia Stock Exchange from 2016 to 2020. There are 12 company samples in this research, which was determined with the purposive sampling method. The series of tests that will be carried out in this study include descriptive statistical analysis, panel data regression model tests, classical assumption tests, multiple linear regression analysis, and hypothesis testing. The data are processed using the EViews 12 software. The outcomes of this study show that profitability (ROA) and non-debt tax shields (NDTS) are affecting the capital structure (DER) negatively and significantly, growth opportunities (MTB) is affecting the capital structure (DER) positively and significantly, while asset structure (TANG) does not affect the capital structure significantly.