Political Connection Moderate Effect of Tax Haven Utilization and Corporate Governance on Tax Aggressiveness
DOI:
https://doi.org/10.26740/jaj.v15n2.p88-103Keywords:
Keywords: tax haven utilization, corporate governance, political connections and tax aggressivenessAbstract
Introduction/Main Objectives: This research was very relevant to the scope of tax policy, corporate
governance, and accountability, and it had a central role in encouraging improvements in tax practices.
Background Problems: This research examines the influence of tax haven utilization and corporate
governance on tax aggressiveness by mediating political connections in manufacturing companies listed
on the Indonesia Stock Exchange. Research Methods: This research used quantitative data, and the type
of data researchers use was secondary data. The population in this research was 168 manufacturing
companies registered on the IDX during the 2019-2022 period. Sampling was done using purposive
sampling, and a sample of 144 companies was obtained. Data management in this research uses the
Structural Equation Model (SEM) through the smart PLS computer program or application.
Finding/Results: The empirical findings show that tax haven utilization does not affect political
connections and tax aggressiveness, while corporate governance directly influences tax aggressiveness and
political connections. Conclusion: Political connections mediate the relationship between corporate
governance and tax aggressiveness
References
Ardillah, K. & Halim, Y. (2022). The Effect of Institutional Ownership, Fiscal Loss Compensation, and Accounting Conservatism on Tax Avoidance. Journal of Accounting, Auditing, and Business, Vol. 5, No. 1, 1-15.
Ardillah, K. & Prasetyo, A. C. (2021). Executive Compensation, Executive Character, Audit Committee, and Audit Quality on Tax Avoidance. Akuntabilitas: Jurnal Ilmu Akuntansi, Vol. 14, No. 2, 169-186.
Ardyansah, D., & Zulaikha. (2014). Pengaruh Size, Profitability, Capital Intensity Ratio dan Komisaris Independen terhadap Effective Tax Rate (ETR). Diponegoro Journal of Accounting, Vol. 3, No. 2, 1-9.
Armstrong, B. (2015). Corporate Governance, Incentives, and Tax Avoidance. Journal of Accounting and Economics, Vol. 60, Issue 1, 1-17.
Brigham, E. F., & Houston, J. F. (2019). Fundamentals of Financial Management. Cengage Learning.
Brown, J.L., Drake, K., & Wellman, L. (2015). The Benefits of A Relational Approach to Corporate Political Activity: Evidence from Political Contributions to Tax Policymakers. The American Taxation Association Journal, Vol. 37 (1), 69-102.
Butje, S. & Tjondro, E. (2014). Pengaruh Karakter Eksekutif dan Koneksi Politik terhadap Tax Avoidance. Tax and Accounting Review, Vol 4, No. 2, 1-9.
Chen, S., Chen, X., Cheng, Q, & Shevlin, T. (2010). Are Family Firms More Tax Aggressive Than Non-Family Firms? Journal of Financial Economics, Vol. 95, 41-61.
Coleman, N., & Bean, E. J. 2006. Tax Haven Abuses: the Enablers, the Tools and Secrecy Minority & Majority Staff Report Permanent Subcommittee. Office.
Damayanti, H. H. (2017). Peran OECD Dalam Meminimalisasi Upaya Tax Agresiveness. Jurnal Akuntansi Multiparadigma JAMAL Volume 8, Nomor 1,ISSN: 2086-7603, e-ISSN: 2089-5879, 1-227.
Damayanti, H.H., & Prastiwi, D. (2017). Peran Oecd Dalam Meminimalisasi Upaya Tax Agresiveness Pada Perusahaan Multinationality. Jurnal Akuntansi Multiparadigma, Volume 8, Nomor 1
Desai, M., & Dharmapala, D. 2009. Earnings management, corporate tax shelters, and book-tax alignment. Harvard Business School Finance Working Paper, No. 884812 Cambridge, MA.
Desai, M.A., Foley, C. F., & Hines, J.R. 2006a. The demand for tax haven operations. Journal of public Economics, 90, 513-531
Desai, M.A., Foley, C. F., & Hines, J.R. 2006b. Do Tax Haven Divert economic activity? Economics Letters, 90, 21-224
Dewi, N. N. K., & Jati, I. K. (2014). Pengaruh Karakter Eksekutif, Karakteristik Perusahaan, dan Dimensi Tata Kelola Perusahaan Yang Baik Pada Tax Avoidance Di Bursa Efek Indonesia. E- Jurnal Akuntansi Universitas Udayana, Vol. 6, No. 2, 249260.
Diantari, P. R. & Ulupui. I. G. K. A. (2016). Pengaruh Komite Audit, Proporsi Komisaris Independen dan Proporsi Kepemilikan Institusional terhadap Tax Avoidance. EJurnal Akuntansi Universitas Udayana, Vol 16, No. 1, 702-732.
Faccio, M. (2010). Differences Between Politically Connected And Nonconnected Firms: A Cross?Country Analysis. Financial Management, Vol. 39 (3), 905-928.
Faccio, M. 2006. Politically Connected Firms. The American Economic Review 96 (1):369-386.
Faccio, M., Masulis, R.W., McConnell, J.J. 2006. Political Connections and Corporate Bailouts. The Journal of Finance61: 2597-2635.
Fan, J.P.H., Wong, T.J., Zhang, T., 2007. Politically Connected CEOs, Corporate Governance, and Post-IPO Performance of China's Newly Partially Privatized Firms. Journal of Financial Economics 84: 330-357.
Fan, Joseph dan Wong,T. J. 2002. Corporate Ownership Structure and the Informativeness of AccountingEarning in East Asia. Journal of Accounting and Economics33 (9),401-425.
Frank, M. M., Lynch, L. J., & Rego, S. O. (2009). Tax reporting aggressiveness and its relation to aggressive financial reporting. The Accounting Review, 84(2), 467-496. http:// doi.org/10.2308/accr.2009.84.2.467
Ghasani, N. A. L. S., Nurdiono, N., Agustina, Y., & Indra, A. Z. (2021). The Effect of Transfer Pricing, Leverage, and Profitability to Tax Avoidance. Journal of Accounting and Finance, Vol. 26, No. 1.
Ghozali, I. (2018). Aplikasi Analisis Multivariete Dengan Program. IBM SPSS 25. Semarang: Badan Penerbit Universitas Diponegoro.
Godfrey, J., Hodgson, A., Tarca, A., Hamilton, J., & Holmes, S. (2010). Accounting theory. John Wiley & Sons Australia.
Gunawan, Y., Christy, Y., Tin, S., & Jonathan, L. (2021). The Influence of Independent Board of Commissioners, Audit Committee, and Audit Quality on Tax Avoidance. BALANCE: Economic, Business, Management, and Accounting Journal, Vol. XVIII, No. 1, 42-49.
Indonesia. Undang-Undang Ketentuan Umum dan Tata Cara Perpajakan. Undang-Undang No. 16/2009 tentang Penetapan Peraturan Pemerintah Pengganti Undang-Undang Nomor 5 Tahun 2008 Tentang Perubahan Keempat Atas Undang-Undang Nomor 6 Tahun 1983 Tentang Ketentuan Umum Dan Tata Cara Perpajakan Menjadi UndangUndang.
Indonesia. Undang-Undang Pajak Penghasilan. Undang-undang No.7/1983 tentang Pajak Penghasilan sebagaimana telah beberapa kali diubah terakhir dengan Undang-Undang No.36/2008
Jensen, & Meckling. (1976). The Theory of The Firm: Manjerial Behavior, Agency Cost and Ownership Structure. Journal of Financial and Economic Volume 3, 305-306.
Jensen, M. C. & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs, and Ownership Structure. Journal of Financial Economics, Vol. 3, 305-360.
Lanis, R. & Richardson, G. (2011). The Effect of Board Director Composition On Corporate Tax Aggressiveness. Journal of Accounting and Public Policy, 30 (1), 50-70.
Leuz, Christian & Oberholzer-Gee, Felix, 2006. "Political relationships, global financing, and corporate transparency: Evidence from Indonesia," Journal of Financial Economics, Elsevier, vol. 81(2), pages 411-439, August.
Lutfia, A. d. (2018). Pengaruh Transfer Pricing, Kepemilikan Institusional, dan Komisaris Independen Terhadap Tax Avoidance. e-Proceeding of Management: Volume 5, No.2, ISSN: 2355-9357, 2386.
Mais, R. G. & Patminingih, D. (2017). Effect of Good Corporate Governance on Tax Avoidance of The Company in Listed of The Indonesia Stock Exchange (BEI). Jurnal STEI Ekonomi, Vol. 26, No. 2, 230-243.
Mappadang, A. (2021). Corporate Governance and Corporate Tax Avoidance: An Interactive Effects (Evidence from Indonesia Capital Market). Jurnal Keuangan dan Perbankan, Vol. 25, No. 1, 81-92
Pohan, C. A. (2016). Pedoman Lengkap Pajak Internasional. Jakarta: PT Gramedia Pustaka Utama.
Robin, Toni, N., & Simorangkir, E. N. (2021). The Influence of Transfer Pricing, Corporate Governance, CSR, and Earnings Management on Tax Aggressiveness. Journal of Industrial Engineering & Management Study, Vol. 2, No. 5, 234-244.
Sahrir, S., Syamsuddin, S., & Sultan. S. (2021). Pengaruh Koneksi Politik, Intensitas Aset Tetap, Komisaris Independen, Profitabilitas, dan Leverage terhadap Tax Avoidance. Jurnal Penelitian Ekonomi Akuntansi, Vol. 5, No. 1, 14-30.
Salwah, S. d. (2019). Pengaruh Aktivitas Thin Capitalization Terhadap Penghindaran Pajak. Jurnal Riset Bisnis Vol. 3 (1), 30-36.
Scott, W.R. (2015). Financial Accounting Theory 5th Edition. Toronto: Pearson Prentice Hall.
Suandy, Erly. 2008. Perencanaan Pajak. (Edisi ke-4). Jakarta: Salemba Empat.
Sudibyo, Y. A., & Jianfu, S. (2016). Political Connections, State Owned Enterprises And Tax Avoidance : An Evidanve From Indonesia. Corporate Ownership & Control, 13(3).
Sugeng, P. E., & Zaman, B. (2020). Does Capital Intensity, Inventory Intensity, Firm Size, Firm Risk, and Political Connections Affect Tax Aggressiveness? JEMA, Vol. 17 (1), 78-87.
Sugiyono. (2017). Metode Penelitian Kuantitatif, Kualitatif, dan R & D. Bandung : CV. Alfabeta.
Sunarto, S., Widjaja, B., & Oktaviani, R. M. (2021). The Effect of Corporate Governance on Tax Avoidance: The Role of Profitability as a Mediating Variable. The Journal of Asian Finance, Economics, and Business, Vol. 8, Issue 3, 217-227.
Sutedi, A. (2011). Tata Kelola Perusahaan. Jakarta: Sinar Grafika.
Yamin, Sofyan dan Heri Kurniawan. 2014. SPSS Complete: Teknik Analisis Statistik Terlengkap SPSS (Edisi 2). Jakarta: Salemba Empat.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Gunawan Wibisono
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Abstract views: 284
,
PDF Downloads: 248
