Tax Avoidance Research Articles

Pengaruh Thin Capitalization, Sales Growth, dan Transfer Pricing Terhadap Tax Avoidance

The research objective is to examine the influence of Thin Capitalization, Sales Growth, and Transfer Pricing on tax avoidance in property and real estate sector companies in 2019-2022. This research applies a quantitative research approach that utilizes secondary data obtained from financial reports and ongoing business reports. The research sample consisted of 89, the sample was selected using a purposive sampling technique, data was collected from 17 sample companies during the 4 year research period. Data analysis uses multiple regression analysis techniques to analyze the relationship between thin capitalization, sales growth, transfer pricing and tax avoidance. The research findings show that these factors have a considerable negative impact on tax avoidance. Therefore, if corporations apply a higher level of responsibility for thin capitalization, sales growth and transfer pricing in tax avoidance practices, this will effectively prevent potential tax avoidance from occurring.

Analisis Likuiditas, Tax Avoidance, Pertumbuhan Penjualan dan Pertumbuhan Laba Terhadap Nilai Perusahaan: Studi Keuangan pada Perusahaan Subsektor Tekstil dan Garmen yang Terdaftar di Bursa Efek Indonesia Tahun 2022

The aim of this research is to find out how the influence of Liquidity, Tax Avoidance, Sales Growth and Profit Growth on Company Value is described. The population in this research is textile and garment sub-sector companies listed on the Indonesia Stock Exchange for the 2022 period. The method used is a quantitative method with an associative descriptive approach. With a total sample of 19 with saturated sampling. Using secondary data collection techniques and descriptive statistical analysis, classic assumption tests with normality test, multicollinearity test, heteroscedasticity test, coefficient of determination, multiple correlation coefficient, multiple linear regression test, partial test (t) and simultaneous test (f). The statistical results of the f test (Simultaneous Test) show that there is a simultaneous and significant influence of the variables Liquidity, Tax Avoidance, Sales Growth, Profit Growth on Company Value. Based on the statistical results of the t test (partial test), liquidity has a negative and significant effect on Company Value. Meanwhile, Tax Avoidance has a positive and insignificant effect on Company Value. Furthermore, Sales Growth has a positive and significant effect on Company Value. And Profit Growth has a negative and insignificant effect on Company Value.

Comparative Study of Corporate Governance and Culture in Indonesia and Malaysia: The Effect on Tax Avoidance and Corporate Social Responsibility

Comparative Study of Corporate Governance and Culture in Indonesia and Malaysia: The Effect on Tax Avoidance and Corporate Social Responsibility

DETERMINANTS OF TAX AGGRESSIVENESS WITH CORPORATE GOVERNANCE AS A MODERATION VARIABLE IN PUBLIC COMPANIES IN INDONESIA

This research examines how corporate governance moderates the impact of financial derivatives, executive pay, executive traits, and family ownership on tax aggressiveness in manufacturing firms listed on the Indonesia Stock Exchange between 2021 and 2023. Independent commissioners are used as a proxy for corporate governance. A total of 86 companies were included in the study using purposive sampling. The data analysis method employed was moderated regression analysis (MRA). The findings indicated that tax aggressiveness was impacted by financial derivatives, executive compensation, and executive behaviour but not by family ownership. These findings suggest that the level of family ownership does not dictate the degree of tax avoidance. Corporate governance as a moderating factor can influence executive compensation and executive behaviour but does not influence financial derivatives and family ownership concerning tax aggressiveness.

The Impact of Cryptocurrency Exposure on Corporate Tax Avoidance Among US Listed Companies

This study examined the association between corporate cryptocurrency activities and tax avoidance outcomes, utilizing data from US public firms covering the period from 2015 to 2023. Financial data were sourced from Compustat, while details regarding cryptocurrency activities were manually extracted from 10-K and 10-Q filings. Our analysis employed a fixed-effects regression model to examine the impact of these activities on cash effective tax rates (ETR). The findings indicate that firms engaged in cryptocurrency activities tend to have a lower ETR compared with those without such involvement. Notably, this effect was predominantly observed in companies directly engaged in cryptocurrency activities, such as accepting cryptocurrency as a payment method or actively trading cryptocurrency on an exchange platform. In contrast, firms involved in crypto mining or initial coin offerings did not exhibit a similar association. Our findings offer significant regulatory insights for governance bodies concerned with the implications of corporate cryptocurrency activities on tax strategies.

The Impact of Financial Technology on Accounting Measurement to Enhance Capital Markets to Reduce Tax Avoidance: An Empirical Study

Many countries of the world have turned to the use of financial technology in advanced economies, as this trend imposed by the fourth technology revolution that the world has known in recent years has allowed to improve the quality of financial services provided to the public of customers, reduce their cost, and provide them to the class of customers that were previously financially excluded. FinTech applications have replaced the human factor in financial institutions and financial systems in general, from managing financial risks, providing financial services to clients, and other tasks that require processing a huge amount of information and data, in a way that enhances the role played by financial technology innovations in Preparing and presenting the financial statements of companies providing these services quickly and with high accuracy in accordance with the requirements of the International Financial Reporting Standards (IFRS), in a way that contributes to reducing financial corruption and audit failures, and limits tax avoidance, and that financial technology innovations lead to adaptation with electronic tax systems, and the researcher prepared An applied study on a sample of financial technology companies, and it became clear to the researcher the existence of a set of challenges represented in accounting and tax problems, the researcher provided solutions to them, and the researcher prepared a field study on the same sample, and it was found from the statistical study, the rejection of the study’s hypotheses and therefore there are no differences between the categories The study was based on the outputs of the SPSS program, Chi-Square, and the study ended with a set of results and recommendations.

The Flaw in the Plan: Information Transparency and International Tax Avoidance Channels

The Flaw in the Plan: Information Transparency and International Tax Avoidance Channels

Retraction notice: CEO power and corporate tax avoidance in emerging economies: does ownership structure matter?

Retraction notice: CEO power and corporate tax avoidance in emerging economies: does ownership structure matter?

Determinants of Tax Avoidance Intentions in Tourism SMEs: The Mediating Role of Coercive Power, Digital Transformation, and the Moderating Effect of CSR

Tax compliance and avoidance are critical issues for governments and businesses worldwide, especially as businesses often use legal methods to minimize taxes, which can impact public revenue and equity within the tax system. This study focuses on understanding the factors influencing tax avoidance behaviors among SMEs in Greece’s tourism sector, a sector that has received limited research attention. To this end, a quantitative cross-sectional design was employed, using a structured questionnaire to explore potential factors influencing tax avoidance behavior. Data were collected from 534 SME managers and analyzed using Structural Equation Modeling (SEM) to assess the impact of key factors and their interrelationships, including coercive power, digital transformation, tax knowledge, firm performance, and perceived fairness, on tax avoidance. In addition, corporate social responsibility (CSR) was included as a moderator variable, while coercive power and digital transformation were assessed as mediators. Furthermore, Multi-Group Analysis (MGA) was conducted to explore the differences between small and medium enterprises, as well as different ownership structures. The results indicate that all key determinants, except perceived fairness, are significantly and positively related to tax avoidance intention. Additionally, it was revealed that coercive power increases tax avoidance through firm performance and tax knowledge, while digital transformation mediates the influence of firm performance on tax avoidance by curtailing avoidance intentions. While CSR mitigates the negative influence of coercive power, digital transformation has a dual role: that of promoting transparency and strategic efforts to reduce the tax burden. These findings have important policy implications, as policymakers seek to promote digital adoption and enhance CSR engagement while formulating specific regulatory strategies to reduce tax avoidance among SMEs.

Financial Determinants of Tax Avoidance: Insight from the Telecom Sector with Profitability Moderation

Financial Determinants of Tax Avoidance: Insight from the Telecom Sector with Profitability Moderation

Harnessing network power: Weaponised interdependence in global tax policy

AbstractFor decades, global tax policy has grappled with the challenge of mobile capital, failing to harness the regulatory potential of network power. This oversight has allowed tax havens to flourish, and multinational corporations and wealthy elites to circumvent state authority, undermining national fiscal policies and democratic capacity to meet grand societal challenges, such as climate change and inequality. But recent regulatory innovations pave a different way forward. This article spotlights the dynamics of ‘weaponized interdependence’, suggesting a critical role for strategically targeting global corporate and financial networks in reinvigorating action against tax havens, tax avoidance and tax evasion. Identifying and exploiting network chokepoints – financial institutions, corporate subsidiaries and expert intermediaries – can empower states to reassert their sovereignty and counterbalance the structural advantages of global capital. This approach helps us understand how and why recent regulatory measures have effectively countered financial secrecy, profit shifting and sanctions evasion, repairing public finances and restoring democratic integrity. In an age where weaponised interdependence is predominantly linked to national security, this recasting of global tax policy highlights a progressive path for using network power to develop effective global economic frameworks, strengthen democratic capacity and address contemporary challenges.

How Does Tax Avoidance Affect a Firm's Investment Inefficiency in Taiwan's Semiconductor Industry?

ABSTRACTThis study examines an important issue regarding how tax avoidance affects a firm's investment inefficiency in Taiwan's semiconductor industry. In addition, the dynamic effect of a firm's investment inefficiency and spillover effect of investment inefficiency from competitors are also explored. This study adopts 44 listed firms from 2013 to 2021 and constructs the “competitor‐dependence matrix” to replace the “spatial‐dependence matrix” in the dynamic spatial autoregressive model. According to the difference generalized method of moments estimation, the primary finding of this study is that the tax avoidance has a statistically and significantly positive effect on a firm's investment inefficiency while it is overinvestment, but a negative effect while it is underinvestment. Moreover, the dynamic effect is statistically insignificant, but the spillover effect is statistically and significantly negative.

Corporate tax avoidance and narrative disclosure tone: a developing country perspective

Purpose This study aims to examine the link between tax avoidance, corporate governance and narrative disclosure tone using a sample of public companies in Pakistan. Design/methodology/approach Data for 125 companies listed on the Pakistan Stock Exchange (PSX) are collected over 10 years from 2011 to 2020. Sentiment analysis is conducted to determine the disclosure tone, and regression analysis is used to test the association between the variables. Findings This paper finds that firms that engage in tax avoidance tend to use a more positive disclosure tone and are more likely to engage in impression management. Moreover, promoting sound governance through board independence and gender diversity is associated with a less positive disclosure tone. However, firms with more family board members and higher foreign ownership are more likely to use a more positive disclosure tone. Practical implications Regulators can use this information to develop better guidelines to protect investors and ensure faithful disclosures to address both positive and negative news. Originality/value The study contributes to the literature by examining corporate tax avoidance as a determinant of narrative disclosure tone, a relationship that has not been widely explored. Moreover, as most disclosure tone research has been conducted in developed countries, this paper provides valuable evidence from a developing country.

The Effect of Tax Avoidance, Tax Risk, Audit Tenure, on Firm Value Through Financial Performance

The Effect of Tax Avoidance, Tax Risk, Audit Tenure, on Firm Value Through Financial Performance

The Effect Of Audit Committee, Firm Value, Sales Growth And Firm Size On Tax Avoidance With Corporate Transparency As A Moderating Variable

This study is a development of research entitled The Effect of Company Size, Company Value, Sales Growht on Tax Avoidance with Corporate Transparency as a Moderating Variable. It tests the food and beverage sub-sector companies listed on the Indonesia Stock Exchange for the period 2016 to 2021. Whereas in this study I will test the manufacturing sub-sector using the 2019 - 2022 financial report period. This study uses descriptive statistical analysis to describe data from 2012-2022, the objectives of this study are: To determine empirically the effect of the Audit Committee on tax avoidance, to determine empirically the effect of Company Value on tax avoidance, to determine empirically the effect of Sales Growth on tax avoidance, to determine empirically the effect of Firm Size on tax avoidance, to test the moderating effect of Corporate Transparency in the effect of the Audit Committee on tax avoidance, to test the moderating effect of Corporate Transparency in the effect of Company Value on tax avoidance, to test the moderating effect of Corporate Transparency in the effect of Sales Growth on tax avoidance, to test the moderating effect of Corporate Transparency in the effect of Firm Size on tax avoidance.

Effect Of Earnings Management, Leverage, And CSR On Tax Avoidance With GCG As Moderating Variable

This study aims to test and analyze the effect of Earning management, leverage, and CSR on Tax avoidance with moderated by independent commissioners for GCG. Property and real estate companies are the population used in this study, where the processed companies are companies listed on the Indonesia Stock Exchange (IDX) from 2018 to 2022. Quantitative approach is used in research”using secondary data in the form of financial statements”for 2018-2022. The purposive sampling method is one of the methods used for research, from this method researchers get 15 real estate companies as research samples. This study uses partial least squares (PLS) and SmartPLS 3. The results of this study indicate that earnings management and leverage have no significant impact on tax avoidance. GCG is unable to moderate Earning Management, Leverage, and CSR on Tax Avoidance because the P-Values are less than 0.5%. While Corporate Social Responsibility has a significant effect on Tax Avoidance because the P-Values are greater than 0.5%. The results of this study can be good input to the government or companies in the best possible taxation practices, so that practices that utilize tax avoidance can be used.

The Influence Of Financial Performance, Audit Quality, Earnings Management On Tax Avoidance With Capital Intensity As A Moderating Variable

This study aims to analyze and provide empirical evidence on the influence of profitability on tax avoidance; the influence of leverage on tax avoidance; the influence of audit quality and earnings management on tax avoidance; the moderation effect of capital intensity on the relationship between profitability and tax avoidance; the moderation effect of capital intensity on the relationship between leverage and tax avoidance; and the moderation effect of capital intensity on the relationship between audit quality and earnings management with tax avoidance. The research methodology employed is quantitative. Secondary data sources consist of financial reports from companies in the infrastructure sector listed on the Indonesia Stock Exchange during the period 2020-2022. The population comprises companies in the infrastructure sector, with a sample size of 111 selected using purposive sampling based on specified criteria. The research employs panel data regression analysis, with data processed using Eviews version 12. Partially, the study finds that ROA, leverage, and audit quality significantly influence tax avoidance, while earnings management does not significantly affect tax avoidance. Capital intensity strengthens the influence of ROA and earnings management on tax avoidance, while weakening the influence of leverage and audit quality on tax avoidance.

The Nexus Between Corporate Governance, CSR, and Firm Value: Tax Avoidance as an Intervening Variable

This research investigates the role of tax avoidance in the relationship between corporate governance, firm value, and corporate social responsibility. The research design is explanatory research, through hypothesis testing. 175 manufacturing companies were observed from 2017 to 2021, with a sample size of 875. A panel regression and leverage acted as a control variable using SPSS software, after conducting models and robustness tests. The findings show the influence of tax avoidance on institutional ownership and economic corporate social responsibility (CSR). Tax avoidance partially mediates the relationship between institutional ownership and firm value, and fully mediates between economic CSR and firm value. The implication for academics and practitioners is that enabling corporate governance requires institutional owners to supervise the determination of company managerial policies. Additionally, the economic CSR program can reduce tax avoidance and is responded to positively by investors. The limitations of the research are that for the constant value to be significant, additional variables should be added to the model. Further research could include adding company performance, gender, and intellectual capital variables. Keywords: corporate governance, corporate responsibility, tax avoidance, leverage, firm value

Reputational Costs as a Tax Avoidance Deterrent in Small to Medium Enterprises

Reputational concerns are considered a disincentive to tax avoidance. Prior literature examining tax avoidance in the context of large and listed firms attributes this relationship to the scrutiny to which large firms are subject. This begs the question if reputational concerns are a relevant tax avoidance deterrent in the setting of small to medium sized enterprises (SMEs) because SMEs have fewer stakeholders, lower disclosure requirements, and are subject to less media attention. Using survey data from Belgian SMEs, we find that SMEs with reputational concerns report an effective tax rate that is 8.57 percentage points higher than that of SMEs with low reputational concerns. We further examine which firm characteristics moderate the deterrent effect of reputational concerns on tax avoidance. We find that potential reputation damage is more important to the tax avoidance decision of firms with less financial freedom and firms with a higher need to maintain creditor relations. Finally, we document that reputational concerns act as a corporate tax avoidance deterrent against aggressive positions.

Does centralization of tax administration regulate tax competition? Evidence from a quasi-natural experiment in China

This study investigates how the centralization of tax administration affects tax competition among local governments in China, using the merger of the State Tax Bureau and Local Tax Bureau in 2018 as a quasi-natural experiment. Our findings demonstrate that the centralization of tax administration effectively curtails the degree of tax competition among local governments, resulting in an increase in the tax burden for enterprises previously managed by the local tax bureaus. Mechanism tests indicate that the reform significantly increases the tax burden on enterprises in regions with high levels of tax competition, and overall reduces the divergence of tax burden among enterprises, restraining cross-regional investments driven by tax avoidance. Additionally, we find that after the means of tax competition among local governments are curtailed, competition continues through fiscal expenditure. Our study provides evidence from China on curbing inter-governmental tax competition from the perspective of administrative institutional reform.