Institutional Ownership and Tax Avoidance: A Review Agency Theory

Putra, Pasca Dwi; Syah, Dedy Husrizal; Simatupang, Baginda

doi:10.4108/eai.18-10-2018.2287316

Cited by 5 publications

(8 citation statements)

References 11 publications

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“…Profit-making organizations can legally plan taxes and still engage in activities that can lead to tax avoidance. These findings corroborate the findings of other researchers that tax avoidance is the common method adopted by organizations in tax planning and is usually exhibited through tax-exempt status (Agyei et al , 2020; Putra et al , 2018).…”

Section: Analysis Of Tax Avoidance Proxy Driverssupporting

confidence: 91%

“…As shown in Table 2, the trend of tax-exempt income as a percentage of PBT and statutory tax from 2011 to 2019 is, thus, indicative of the extent to which this item was exploited yearly for tax planning and risk management considerations. When organizations engage in legal tax planning, they intend to avoid tax (Putra et al , 2018). This is particularly true for organizations that are tax aggressive (Sari, 2019).…”

Section: Results and Analysismentioning

confidence: 99%

“…One can argue that the banks clearly had no other tax strategy or plan outside the reliance on the current provision of the exempt income law to sustain earnings management and low tax payment in the past nine years. The first step in tax management is tax planning, and the common strategy deployed by most organizations is tax avoidance (Putra et al , 2018). Profit-making organizations can legally plan taxes and still engage in activities that can lead to tax avoidance.…”

Section: Analysis Of Tax Avoidance Proxy Driversmentioning

confidence: 99%

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Tax avoidance in banking institutions: an analysis of the top seven Nigerian banks

Folorunso

Lokanan

2022

JFC

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Purpose The purpose of this paper is to review the quantum and magnitude of tax avoidance in Nigeria's top seven banks by using recognized tax avoidance proxies of the Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting Standard (IFRS) effective tax rate (ETR) and book-tax gap analysis for the appraisal. Design/methodology/approach Data for the paper came from the annual reports of the banks between 2011 and 2019. The individual bank’s tax data was analyzed for trends and then consolidated to establish the average percentages and the exact amount of the tax the banks evaded each year and cumulatively over the review period. The data were then matched with analytics of the drivers of tax avoidance in the reconciliation statement to highlight essential tax planning items and strategies being exploited by each bank in the pursuit of aggressive tax avoidance behavior. Findings F-test comparing the aggregate means (all banks) for tax evasion proxies of ETR and the book-tax gap was conducted at a 95% confidence interval. The results of this paper indicate no significant difference between the means obtained, thus affirming that the same pattern of tax evasion was consistent among the banks for the years reviewed. Originality/value The findings of this paper highlight the tax avoidance behavior of the referenced banks, identify weaknesses in the corporate tax planning policy pursued and serve to alert policymakers of the need to strengthen the laws and block loopholes that provide rooms for unrestrained tax avoidance behavior in the banking sector.

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Section: Analysis Of Tax Avoidance Proxy Driverssupporting

confidence: 91%

Section: Results and Analysismentioning

confidence: 99%

Section: Analysis Of Tax Avoidance Proxy Driversmentioning

confidence: 99%

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Tax avoidance in banking institutions: an analysis of the top seven Nigerian banks

Folorunso

Lokanan

2022

JFC

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“…Both of these theories are related to tax avoidance issues and are considered appropriate for review. By considering the significance of the review-based study, different authors have carried out the review-based study on tax avoidance behavior from different perspectives such as tax planning behavior of multinational enterprises (Cooper & Nguyen, 2020;Wang, Xu, Sun, & Cullinan, 2020), family firms (Khelil & Khlif, 2022), determinants (Sritharan, Salawati, Sharon, & Syubaili, 2022), proxies (Lee et al, 2015), institutional ownership (Putra et al, 2019), CSR disclosure (Jiang, Zhang, & Si, 2022) and corporate governance (Kovermann & Velte, 2019). Still, there is a lack of work that gives a thorough overview of the factors that contribute to tax avoidance…”

Section: Theoretical Frameworkmentioning

confidence: 99%

Corporate tax avoidance: a systematic literature review and future research directions

Duhoon,

Singh

2023

LBSJMR

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PurposeThe increased interest among academicians to explore more about tax management behavior is evident in the literature on corporate tax avoidance. This paper aims to illustrate the multiple aspects that influence the tax avoidance behavior of corporations and its impacts through the systematic review method.Design/methodology/approachThis study used “Tax Avoidance” OR “Tax Aggressiveness” OR “Tax Planning” as search strings to extract the relevant literature from the Scopus database. This study is a comprehensive analysis of existing literature on corporate tax avoidance behavior. Further, the keyword network analysis has been used to find out the most explored and dry research areas related to corporate tax avoidance behavior using VOSviewer software.FindingsThe study finds that taxation decision is an important managerial decision. Managers adopt tax avoidance tactics to boost postax profits to meet the shareholders’ expectations, particularly of risk-averse shareholders, and sometimes for their benefit also. With this, this study also finds that firms’ characteristics, political connections and corporate social responsibility activities also impact taxation decisions. In addition, the study identifies that tax-avoiding behavior has a contradictory impact on firm value, market growth and corporate transparency disclosure decisions.Research limitations/implicationsThe study assists the researchers by providing a brief overview of tax avoidance behavior, for corporates in understanding the implications of tax avoidance, and for policymakers to fix the taxation loopholes and bring necessary tax reforms.Originality/valueThis study adds to the existing literature by providing a thorough overview of theories, determinants and outcomes of corporate tax avoidance behavior.

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“…Basically there are differences in interests between company owners and managers. As a result there is a conflict of interest thatcauses financial information to be conveyed asymmetrically [6]. With this information asymmetry and differences in interests, company management will tend to take actions aimed at obtaining the desired benefits by cheating, both within the company itself and at companies that have a special relationship or transfer pricing.…”

Section: Introductionmentioning

confidence: 99%

Transfer Pricing and Mangerial Ownership Against Tax Avoidance in Manufacture Companies on The Indonesia Stock Exchange

Amalia¹,

Gunawan²

2020

Proceedings of the the 3rd International Conference on Advance &Amp; Scientific Innovation

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This study aims to analyze the influence of transfer pricing and managerial ownership of tax avoidance activity by focusing on the manufacturing companies listed in Indonesia Stock Exchange with research period in 2016-2019. The existing tax gap has become a matter of encouraging companies that have a special relationship to practice transfer pricing so that taxes paid domestically are lower than they should be paid. The data used in this research are secondary data. The population in this study are manufacturing companies listed in Indonesia Stock Exchange. The sampling selection method used was purposive sampling and obtained 126 companies with total of 380 samples. The analytical tool used in this study was the linear regression analysis. The results of this research showed that transfer pricing and managerial ownership have no effect on tax avoidance.

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Institutional Ownership and Tax Avoidance: A Review Agency Theory

Cited by 5 publications

References 11 publications

Tax avoidance in banking institutions: an analysis of the top seven Nigerian banks

Tax avoidance in banking institutions: an analysis of the top seven Nigerian banks

Corporate tax avoidance: a systematic literature review and future research directions

Transfer Pricing and Mangerial Ownership Against Tax Avoidance in Manufacture Companies on The Indonesia Stock Exchange

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