Multinational Corporate Tax Avoidance in Indonesia

Authors

DOI:

https://doi.org/10.26668/businessreview/2023.v8i2.1549

Keywords:

Foreign Ownership, Foreign Director, Transfer Pricing, Multinational Corporation, Tax Avoidance

Abstract

Purpose:  This study aims to examine and analyze the effect of foreign ownership, foreign directors, transfer pricing, and multinational corporation on tax avoidance.

 

Design/methodology/approach: The population of this study is multinational corporations listed on the Indonesia Stock Exchange for the period 2016-2019. Using the purposive sampling technique, the sample obtained according to the criteria is 280 observations. Data analysis was using eviews 9 software based on panel data.

 

Findings: The results showed that foreign ownership had no significant effect on tax avoidance. Furthermore, foreign directors have no significant effect on tax avoidance. Likewise, transfer pricing as a proxy for related parties transactions also has no significant effect on tax avoidance. In contrast, the multinational corporation positively and significantly affects tax avoidance.

 

Research, Practical & Social implications:  Foreign ownership, foreign director, and transfer pricing become the primary basis factors for tax avoidance of multinational corporations in Indonesia.

 

Originality/value:  This study provides an academic contribution regarding the factors that influence tax avoidance by multinational corporations.

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Published

2023-03-01

How to Cite

Oktaviani, R. M., Wulandari, S., & Sunarto. (2023). Multinational Corporate Tax Avoidance in Indonesia. International Journal of Professional Business Review, 8(2), e01549. https://doi.org/10.26668/businessreview/2023.v8i2.1549