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- Title
The Impact of Corporate Governance and Fiscal Loss Compensation on Tax Avoidance Policies: Indonesian Banking Sector.
- Authors
Oktaviani, Rachmawati Meita; Wulandari, Sartika; Srimindarti, Ceacilia; Ma'sum, Muhammad Ali
- Abstract
This research explores the role of corporate governance, audit quality, and fiscal loss compensation in influencing tax avoidance strategies within firms in the Indonesian banking sector. Using financial statements and annual reports of companies listed on the Indonesia Stock Exchange (IDX) from 2017-2021, we employed panel data regression analysis to investigate these relationships. The selection of companies was based on specific criteria, which are detailed within the paper. Our findings revealed that while independent commissioners and audit committees negatively affect tax avoidance, institutional ownership and audit quality had no significant impact. Interestingly, fiscal loss compensation was found to positively influence tax avoidance. Our study indicates that not all corporate governance mechanisms are effective in curbing tax avoidance in the banking sector. Additionally, we highlight the unintended consequences of fiscal loss compensation policies, which may facilitate tax avoidance. These findings have important implications for policy and governance in the banking sector.
- Subjects
INDONESIA; CORPORATE governance; BANKING industry; TAX evasion; INSTITUTIONAL ownership (Stocks)
- Publication
International Journal of Sustainable Development & Planning, 2023, Vol 18, Issue 11, p3641
- ISSN
1743-7601
- Publication type
Article
- DOI
10.18280/ijsdp.181130