Tax Practices Research Articles

Policy Forum: Transparency—An Essential Condition for Ethical Behaviour in Tax Planning

Ethics play a significant role in a critical assessment of tax practice, but ethical standards on their own have a rather limited influence on tax-planning decisions; therefore, transparency is a necessary tool. Tax planning has traditionally been driven by cost-benefit analysis and by a risk-management perspective. However, closer public scrutiny of corporate tax affairs and increased disclosure requirements have put pressure on tax-planning decisions, thus adding an ethical dimension to the risk-management perspective. Transparency is certainly essential in limiting the aggressiveness of tax planning, but its impact on ethics may be broader in providing an occasion to change the "moral meanings" in relation to tax-planning activities for those involved.

Dominasi Asing dalam Agresivitas Pajak di Indonesia

This research aims to provide empirical evidence of the impact of foreign entities on tax aggressiveness in Indonesia. The sample consists of non-financial companies listed on the Indonesia Stock Exchange from 2017 to 2019, totaling 804 firm-years. The independent variables include foreign dominance represented by foreign share ownership, significant foreign share ownership, foreign commissioners, foreign directors, foreign CEOs, and foreign CFOs in these companies, while the dependent variable is tax aggressiveness. The results indicate that foreign ownership and significant foreign ownership do not have a significant influence on aggressive tax avoidance practices, contrary to previous research findings. However, another intriguing finding is that the composition of foreign commissioners and foreign directors has a significant impact on aggressive tax avoidance. The presence of foreign commissioners and directors appears to lead to increased compliance with tax regulations and a reduction in aggressive tax avoidance practices. This can be attributed to considerations of legal risk, reputation, and higher tax planning costs in the context of multinational corporations. These results provide valuable insights into the role of board composition in managing a company's tax practices. Overall, the findings contribute significantly to understanding the factors influencing aggressive tax avoidance practices in Indonesian companies, which can serve as a basis for more effective tax policies in the future. However, it is essential to note that this study has limitations and further research is needed to gain a deeper understanding of the dynamics of tax practices in an ever-evolving business environment.

Pengaruh Transfer pricing dan Sales Growth Terhadap Tax avoidance Pada Perusahaan di Bidang Teknologi (Data IDX 2021-2023)

The global technology sector has experienced significant growth, leading to increased scrutiny of tax practices within companies. Transfer pricing, the practice of setting prices for transactions between affiliated entities, has been a focus of regulatory bodies and academics. The relationship between Sales Growth and Tax Avoidance is an important aspect that has not been explored in the context of technology companies. This research aims to examine the relationship between Transfer pricing, Sales Growth, and Tax Avoidance in the technology industry by utilizing data from the Indonesia Stock Exchange (BEI) from 2021 to 2023. This research uses quantitative methodology, specifically utilizing IDX financial data. for technology companies. Transfer pricing practices will be assessed through financial indicators, while Sales Growth will be measured as a percentage increase in revenue during the research period. Tax Avoidance will be operationalized using predetermined metrics such as effective tax rates. Statistical methods, such as regression analysis, will be used to identify patterns and correlations between variables. Research findings show that there is no relationship between Transfer Pricing and Sales Growth and Tax Avoidance in companies operating in the Technology Sector.

Ethical Analysis of Amazon’s ‘Legal’ Tax Avoidance

This paper gives an overview of the ethical consequences of Amazon’s strategic tax avoidance, exploring its multifaceted impacts on society, economy and environment. Through a meticulous PESTEL analysis and the application of a comprehensive 7-step ethical decision model, the paper highlights that Amazon makes the most of legal loopholes to minimize tax obligations. It argues for the necessity of measures aimed at enhancing fairness, transparency, and ethical obligations in corporate tax practices, emphasizing the imperative for Amazon to integrate social responsibility and sustainable development. This analysis advocates for combined efforts between corporations, governments and communities to address and optimize current unethical tax practices.

Analysis of foreign practice of tax incentives for the development of high-tech industry

The article was prepared based on the results of research carried out at the expense of budget funds under the state assignment of the Financial University. The subject of the study is specific measures in the field of tax regulation of industrial development by the leading industrial powers of the world. The purpose of the work is to explore the use of tax instruments to influence the manufacturing sector of various countries and the areas of their application, considering their evolution and development. The result of the work is the identification of the most promising methods of tax incentives for high-tech industry enterprises, which in the future can be introduced into taxation practice in the Russian Federation in order to stimulate the achievement of the country's technological sovereignty. The main methods used in this study are comparison, classification, statistical and retrospective analysis, as well as economic and mathematical calculations. The result of the work is the identification of the most promising methods of tax incentives for high-tech industry enterprises. The novelty of the study lies in the systematization of tax mechanisms for high-tech industry in industrialized countries, general trends in the development of such mechanisms, as well as justifying the feasibility of using their experience in the Russian Federation. In addition, the novelty lies in making proposals for the adaptation and modification of these mechanisms to Russian economy. The scope of the work is the tax system of the Russian Federation. The main conclusions are the identification among the analyzed instruments the most suitable ones for our country in the current conditions, which in the future can have a stimulating effect on the formation of the technological sovereignty of the Russian Federation, as well as calculation of the potential tax benefits for high-tech industry enterprises.

Pendampingan Usaha Kecil Pengrajin Batik Cirebon dalam Self-Assesment System Sesuai Peraturan Harmonisasi Peraturan Pajak pada Post Covid-19 Era

Since the Covid-19 pandemic hit, business industries in Indonesia have struggled to revive their operations. The contribution of tax payments from Micro, Small, and Medium Enterprises (MSMEs) during the Covid-19 era has also declined. Out of a total of 64.2 million UMKM, only 2.3 million have a Taxpayer Identification Number and are actively paying taxes. In response to this situation, a community service initiative was undertaken by members of the Ikatan Akuntansi Indonesia, Department of Educator Accountants, DKI Jakarta, to assist MSMEs in the Batik Cirebon sector. The aim of this community service was to provide support to Batik Cirebon MSMEs in various areas, including planning, simple cash bookkeeping, determining production costs, sales of products, and introducing tax practices in the post Covid-19 era. The community service was executed through entrepreneur and e-commerce marketing training, tax compliance awareness sessions under the self-assessment tax system scheme for Batik MSMEs, and business consultations tailored for the Batik MSMEs. The outcome of this initiative showed an improved understanding among Batik Cirebon MSMEs in areas such as planning, cash bookkeeping, determining production costs, product sales, and tax practices after the Covid-19 pandemic. The results of this service are expected to be useful for improving the quality of governance towards improving the performance of Cirebon Batik MSMEs in the post-Covid-19 era.

MODERATING EFFECT OF BOARD INDEPENDENCE ON THE RELATIONSHIP BETWEEN FIRM ATTRIBUTES AND TAX AGGRESSIVENESS: EMPIRICAL EVIDENCE FROM THE NIGERIAN BANKS

Despite increased evidence of the critical role of corporate governance in shaping business behaviour, there is still a lack of understanding of how board independence moderates the relationship between firm qualities and tax aggression, particularly in the context of Nigerian banks. This study examines the moderating effect of board independence on firm attributes and tax aggressiveness relationship in Nigerian banks spanning 2012 to 2022. The firm attribute was proxy as firm size, profitability, leverage, and board independence, while tax aggressive was proxy as the effective tax rate. The data was collected from eleven listed commercial banks in Nigeria. Data analysis were performed using random effects based on the Hausman test. The study concludes that larger banks tend to engage less in tax aggressive strategies than smaller banks. Also, boards with more independent directors tend to be less aggressive in tax activities. In addition, the study concludes that highly leveraged firms have a greater interest in minimising taxes to enhance cash flows available for debt service. Furthermore, when the moderating effect of board independence is introduced, the study concludes that the relationship between profitability and tax aggressiveness was insignificant. Furthermore, larger banks engage in tax aggressiveness when independent directors are involved. More so, the moderating effect of board independent directors will cause a reduction in tax aggressiveness as leverage increases. The study suggest that banks management be encouraged to conduct benchmarking exercises and peer comparisons to assess their tax practices to industry standards. This can help identify outliers and promote a more standardised and responsible approach to tax planning.

IRPJ tax planning using the worker's food program: a case study in a company in the area of industrial equipment of Araraquara/SP

The Worker's Feeding Program (PAT) is a tax incentive of deduction established by the Federal Government through Law 6.321/76, with the purpose of providing food to its employees and in return the reduction of the income tax due of the legal persons. In this sense, the objective of the research was to analyze the tax economy of a company that makes industrial machinery and equipment, located in the city of Araraquara in the state of São Paulo, by means of tax planning of the calculation methods of the Worker's Feeding Program (PAT), with the deduction provided for in Law 6.321/76. The research characterized itself as descriptive, case study and documentary, taking a quantitative qualitative approach. Data collection was performed through company documents, digital bookkeeping and tax bookkeeping from 2017 to 2021. The values of food expenses were collected, LALUR and ECF were tabulated, the rates indicated in the legislation were applied, the values of the IRPJ to be paid were calculated, and the comparison between the two methods was finally made. The results obtained demonstrate that the tax economy using the method of deduction of taxable profit is R $ 724.855,00 already updated by SELIC until 09/2022. It was possible to identify that the company collected values in an improper manner, for not carrying out the method proposed by Law 6,321/76, an amount of R$ 557,712.00. It is concluded that the research on the PAT emphasizes the importance of tax planning and the correct application of the tax deductions of Law 6.321/76, highlighting the need for effective tax management and knowledge of tax laws, since the non-use of tax incentives can bring significant tax costs to the companies. This demonstrates the importance of reviewing tax practices and implementing strategies to optimize the tax burden, promoting greater competitiveness and growth of organizations.

On the excessive nature of the tax authority interim measures

The study subject is the interim measures’ institute of the tax authority. The study relevance is due to the incomplete decisions’ execution of tax authorities adopted based on the results of tax audits, which leads to the excessive restrictions’ problem on private property of organizations and individual entrepreneurs. The study purpose is to substantiate the need to exclude interim measures of the tax authority from the Tax Code of the Russian Federation. The study used an analysis of the regulatory legal framework, taxation practices, statistical data, and economic publications on interim measures of the tax authority. The conclusion is made about the presence in the existing mechanism of collecting taxes, penalties, fines of tax authorities’ numerous powers and other state bodies, duplicating each other, having an excessive nature and allowing, when used, to guarantee the decisions’ execution of tax authorities adopted based on the tax audits’ results without interim measures.

Digital Transformation of Tax Administration and Compliance: A Systematic Literature Review on E-Invoicing and Prefilled Returns

This paper systematically reviews the impact of electronic invoicing and prefilling tax returns on tax administration and compliance, adhering to the PRISMA guidelines. Our comprehensive literature search and analysis reveal that these technologies are crucial in reducing tax compliance and administration costs. The results indicate significant benefits, including reduced financial stress for firms, especially during development phases, and enhanced efficiency in tax administration processes. The study highlights how e-invoicing and prefilling systems simplify and improve the tracking of taxation, leading to increased efficiency in tax practices globally. This research contributes to understanding the transformative effects of digital technologies in taxation, demonstrating their potential in streamlining tax compliance and administrative procedures.

Dissecting the Link Between Tax Crimes and Corruption: A Threats to Economic Stability

The paper discusses the complex correlation between tax crime and corruption and its impact on economic stability. Through in-depth analysis, the author explores the links that exist between these both phenomena, identifying how illegitimate tax practices can become a hotbed of corruption at the government level and vice versa. In this context, this article discussed the threats facing economic stability as a consequence of the negative interaction between tax crimes and corruption. It is expected that a better understanding of these dynamics will help authorities design effective policies to protect economic stability and improve the integrity of the tax system. In conclusion, teh paper highlights the need for joint efforts from the government, private sector, and society to prevent and eradicate criminal tax practices and corruption in order to support sustainable economic development.

Ethics of professional activity in the accounting industry

The ethics of professional behavior of accountants and auditors are an integral part of a successful business, the development of the country's economy, the formation of the profession's prestige and the trust of employers, customers, investors and other stakeholders. At the present stage of development, significant changes are taking place in the accounting sphere, due to many factors, the main of which are the development of information technologies, the expansion of the practice of using artificial intelligence, the formation of social responsibility in society, legislative changes, changes in professional competencies, skills and abilities of specialists in the field of accounting and audit. The outlined changes impose additional requirements for the ethics of professional activity of accountants. The article studies the requirements for ethics of professional activity of accountants and auditors in accordance with the requirements and requests of the modern business environment and society: the essence of the concept of «professional ethics of an accountant» and the fundamental ethical principles of professional activity are investigated; a review of the structure and content of the Code of Ethics for Professional Accountants, legislative regulation of the ethics of accounting and auditing activities, the functions of public organizations of professional accountants and auditors in Ukraine; identified potential threats to ethical professional conduct; the consequences arising under conditions of improper observance by the accountants of ethical rules and principles, reduction of integrity and improper level of social responsibility are outlined. The fundamental principles of professional activity of professional accountants and auditors, which include: decency and objectivity; resolving ethical conflicts; professional competence; confidentiality; tax practice; international activities; publicity information. The article studies potential threats to the professional behavior of accountants, which include the threat of their interest, the threat of their assessment, the threat of protection, the threat of personal relationships, the threat of pressure. Failure to comply with the ethics of professional conduct by an accountant or auditor can lead to significant negative consequences: disclosure or loss of confidential information, falsification of identification data of the employer or client, unauthorized use of such data, fraud and corruption. The article considers well-known examples of the consequences of violations of professional ethics by accountants and auditors (the reasons for the bankruptcy of Enron, WorldCom, Le-Nature's Inc.).

Optimizing state revenue through government-driven supply chain efficiency and fair corporate taxation practices

This research tries to analyze the explicit and implicit impact of the smooth supply chain and fairness of the tax system on corporate taxpayer compliance and its implications for state tax revenues. This research uses quantitative methods, using random sampling techniques, and obtained a sample of 100 respondents consisting of various MSMEs registered with the Ministry of Cooperatives and SMEs in 2023 who are taxpayers in South Jakarta City, DKI Jakarta Province, Indonesia. The data obtained from the surveys was utilized in Structural Equation Modelling with Partial Least Squares (SEM-PLS) for additional analysis. Research results and data analysis show that tax system equity has a direct and significant impact on corporate taxpayer compliance; tax system fairness directly has no and minimal impact on state tax revenues; and corporate taxpayer compliance directly and significantly impacts state tax revenues. A smooth supply chain has a direct and substantial impact on corporate taxpayer compliance. Furthermore, a smooth supply chain has a direct and substantial influence on state tax collections. A seamless supply chain and state tax revenues are largely mediated by corporate taxpayer compliance, which has a substantial impact on both. Furthermore, the relationship between the fairness of the tax system and state tax collections in MSMEs in South Jakarta City is totally mediated by corporate taxpayer compliance.

Decoding tax management: The role of corporate governance mechanisms

While tax pressure remains a major concern in corporate management, it is legitimate to ask whether tax has always been among the core factors of corporate governance (Chytis et al., 2020). This study aims to examine the influence of corporate governance on tax management practices within Moroccan firms listed on the Casablanca Stock Exchange (CSE). Focusing on three dimensions of corporate governance — board composition, audit committee structure, and external audit quality — we employed multiple regression analysis on data spanning 2014–2019 from a sample of 48 listed firms, totaling 288 firm observations. Significantly, board size, chief executive officer (CEO) duality, and external audit quality are found to be pivotal factors shaping tax management practices. Other corporate governance variables, notably the independence of the board of directors and the structure of the audit committee, do not appear to exert a significant influence on the tax management of listed Moroccan companies. Our study is one of the few to have addressed the issue of tax management in the Moroccan context. Moreover, it may also serve as a fundamental resource for researchers exploring the complex dynamics of tax practices in the organizational context.

Influência da agressividade tributária na previsão dos analistas financeiros

ABSTRACT Purpose: This paper aims to verify whether the management of taxable income through aggressive tax practices negatively impacts the accuracy of market analysts’ forecasts. Originality/value: The central contribution of this study is to relate tax aggressiveness with more significant errors in analysts’ forecasts. Thus, the relevance of this paper is in showing that this practice can lead to a greater perception of companies’ risks and more significant informational asymmetry, in addition to influencing stock prices and resulting in lower analyst accuracy. Design/methodology/approach: This research paper was developed from regression models with panel data with random effects, also using estimators based on instrumental variables with the application of Jensen’s test to verify the validity of the generalized method of moments (GMM) estimation. The data were treated with the winsorization technique at the 1% level. Findings: A sample of companies listed on the B3 between 2010 and 2017 (with a total of 2,805 valid observations) showed that companies with higher tax aggressiveness are subject to a higher analyst forecast error. Thus, it is inferred that, for more aggressive companies, the degree of analyst predictability decreases. With this drop in the quality of analysts’ forecasts, the users of their forecasts and reports are more vulnerable to informational asymmetry.

Зарубежный опыт фискальных механизмов преференциальной экономики

The subject of the study is the fiscal instruments of the preferential economy, which provides for the establishment of a special preferential business taxation regime for research and development (hereinafter referred to as R&D) and innovation activities in the OECD countries, the EU and partner economies. The objectives of the work are to identify tools to stimulate the commercialization of R&D and highlight general trends in the development of these tools and tax policies of developed countries in the R&D sector. The availability of tax support tools for the commercialization of R&D in almost all the studied countries and their application, along with the provision of tax incentives for R&D expenses to stimulate innovation at different stages of the life cycle of intellectual property objects, is demonstrated. It has been established that the volume of such support is steadily growing. Tax regimes for income from R&D abroad comply with the minimum standard BTPS Action 5, aimed at more effectively countering harmful tax practices that may harm other jurisdictions. The characteristics of income-based tax benefits for R&D are highlighted. It is concluded that it is necessary to introduce the BEPS Action 5 minimum standard in Russia in order to stimulate the IT industry and significantly expand income tax incentives for the commercialization of breakthrough technologies and innovations in other industries.

상속세 및 증여세법상부동산 시가적용에 관한 최근 과세 쟁점

The basic structure of the assessment of property under the current inheritance and gift tax law is a simple one in which it is based on the market price, but in cases where it is impracticable to calculate the current market price, complementary valuation methods are used as an exception. However, the abstractness of the concept of the market price and what specific extent to which it should be recognized as the market price are complex and difficult issues. Because of this, many controversies arise between taxpayers and tax authorities.
 With the purpose of the improvement of fair taxation, Korea's inheritance and gift tax law has continuously expanded the scope of what can be recognized as the market price based on the principle of the market price. This reflects the reality that there is an inevitable conflict of interest between taxpayers who prefer complementary valuation methods due to the property valuation method of the inheritance and gift law, which allows complementary valuation methods to be exceptionally applied only in cases where it is impracticable to calculate the current market price and the realistic price rate of the officially assessed real estate price that is far below the market price, and tax authorities.
 The value recognized as the market price under the current inheritance and gift tax law can be divided into four categories, which are the relevant property and the case value for similar property within the principle of assessment period, and the relevant property and the case value for similar property within the extended evaluation period.
 This study deals with ‘the application of similar case values to apartments, etc.’ which is controversial regarding the scope of market recognition and ‘whether the appraised value requested by the tax office after the reporting date for non-residential real estate, etc. is recognized as market price or not’ targeting real estate, which accounts for a high proportion of inherited and gifted properties. In relation to this, there are many criticisms that it is not only against the principle of fair taxation, but it can also infringe on the taxpayer's predictability in terms of that excessive taxation is imposed on some taxpayers for properties with the same burden due to the existence of a sale price of similar property traded by another person by chance or an appraisal request based on the arbitrary judgment of the tax authorities, etc.
 It is not easy in reality to establish clear and consistent standards that all taxpayers can agree on when calculating the market price of inherited or gifted property whose ownership is transferred gratuitously. However, it is essential that the tax authorities continue to make efforts to accept criticism of existing taxation practices as article 15 of the enforcement rules of the inheritance and gift tax law legislate the scope of similar property in apartments in detail.
 This study analyzed major issues in taxation practice by analyzing the provisions of the inheritance and gift tax law and recent precedents regarding the scope of provisional recognition of the market price and sought ways to improve them. The main tax issues in applying the case value for similar property to apartments, etc. are; first, exclusion of application of the case value for similar property if there is a case value for the relevant property, second, the period of market recognition for the case value for similar property, third, criteria for judging similarity, and fourth, whether there are special circumstances for price fluctuations.

DOES THE DISCLOSURE OF ISLAMIC CORPORATE SOCIAL RESPONSIBILITY, ISLAMIC CORPORATE GOVERNANCE, PROFITABILITY, AND BANK SIZE AFFECT TAX AVOIDANCE IN ISLAMIC COMMERCIAL BANKS IN INDONESIA?

Abstract— This paper investigates the influence of Islamic Corporate Social Responsibility (ICSR), Islamic Corporate Governance (ICG), profitability, and bank size on tax avoidance in Islamic Commercial Banks in Indonesia. This paper introduces a novel perspective on the factors contributing to tax avoidance within Indonesia's Islamic finance framework. While the general notion of tax management is recognized, this study innovatively explores the intersection of Islamic principles, corporate governance, and tax practices, providing insights that have not been adequately explored in prior research. The study employs a panel data regression analysis, utilizing data from 13 Islamic Commercial Banks spanning 2017-2022, totaling 58 observations. This research approach enables an in-depth investigation into the relationships between ICSR disclosure, ICG, profitability, bank size, and tax avoidance. The empirical findings indicate that ICSR disclosure, the proportion of independent commissioners, and the audit committee positively influence tax avoidance practices. Conversely, the Sharia Supervisory Board and bank size negatively correlate with tax avoidance. Surprisingly, as measured by Return on Assets (ROA), profitability does not significantly impact tax avoidance decisions. This study underscores the intricate connections between Islamic corporate practices, governance structures, and tax avoidance strategies in Islamic Commercial Banks. The research highlights the significance of ICSR disclosure, corporate governance effectiveness, and the presence of religious oversight in shaping transparent and accountable tax practices. Furthermore, the research cautions against overreliance on profitability as a determinant of tax avoidance behaviors.
 Keywords: Bank Size; Islamic Corporate Governance, Profitability; Islamic Corporate Social Responsibility; Tax Avoidance

2020년 개정 부가가치세법과 저작권신탁관리제도

Korea’s Value Added Tax Act had treated the supply of goods or services related to trust property in a manner similar to consignment transactions, without explicit statutory provisions. In 2020, the amended Value Added Tax Act (Act No. 17653, dated December 22, 2020, partially amended, enforced from January 1, 2022) designated the trustee as a taxpayer and established specific regulations aimed at preventing tax avoidance and securing tax claims related to trusts.
 The amended Value Added Tax Act primarily focused on real estate trusts and money trusts, giving insufficient attention to copyright trusts, which are mainly used for the management and utilization of copyrights.
 When examining the issues arising from the amended Value Added Tax Act, focusing on the case of music copyright trust management organizations, first, Copyright trust management organizations are expected to bear a significant amount of tax compliance costs in carrying out business registration obligations for trust property belonging to trusts established after January 1, 2022. Next, in accordance with Article 5 of the supplementary provisions of the amended Value Added Tax Act, a situation may arise in which consignor taxation and trustee taxation are applied simultaneously for a considerable period of time, which may undermine the original purpose of introducing the copyright trust, which is to effectively manage and utilize copyright for copyright holders and users. Finally, when applying the consignor’s taxation regulations in cases where the consignor is unknown, Value Added Tax Act does not specify otherwise. Furthermore, within the trustee’s taxation regulations, there are no regulations addressing the application of Value Added Tax exemption on copyright fees.
 As recommendations for addressing the Value Added Tax issues surrounding copyright trust management, the following are proposed. First, the regulations on the registration of trust property comprehensive businesses allowed for real estate collateral trusts of trust companies should be allowed for copyright trust management organizations approved by the Minister of Culture, Sports and Tourism under Article 105 of Copyright Act. Next, when applying Article 5 of the Supplementary Provisions to the revised Value Added Tax Act, copyright trust management organizations must be allowed to selectively exclude application. Finally, in consideration of the characteristics of copyright trusts, a value-added tax practice in the form of consignment trading centered on copyright trust management organizations should be prepared.
 This study is meaningful in that it presents issues and improvement measures in VAT practice related to intellectual property rights not addressed in the VAT area, especially copyright trust management systems using copyright as trust property.

A Literature Review: Tax Planning and Avoidance in Earnings Management

This study aims to give a comprehensive analysis of the intricate relationship between tax planning, tax avoidance, and earnings management in the context of corporate financial practices. Through an extensive literature review, the research elucidates the multifaceted implications of these practices on financial reporting, corporate governance, and adherence to international tax regulations. The findings reveal that legal tax planning, when aligned with strategies to reduce taxable income, can positively impact reported earnings. However, the transformation of tax planning into a tool for earnings management raises ethical and transparency concerns, leading to global regulatory scrutiny. The study also investigates the nuanced impact of a declining tax rate on companies' strategies for managing earnings, emphasizing the need for careful consideration and ethical financial practices. Future research directions are proposed, highlighting the importance of empirical investigations across diverse industries and regions to deepen our understanding of the intricate relationship between tax practices and earnings management. The findings contribute valuable insights for stakeholders, practitioners, and policymakers