Tax Avoidance Ditinjau Dari Capital Intensity, Leverage, Beban Iklan dan Kompensasi Eksekutif

Abstract

The use of high tax avoidance tactics by companies makes the target of government revenue not achieved. Thus making it the basis for testing capital intensity, leverage, advertising expense, executive compensation in influencing tax avoidance. Obtained a population of 14 food and beverage sub-sector companies listed on BEI in 2015-2018. With the use of purposive sampling technique as sampling, the final sample is 9 food and beverage sub-sector companies or 36 observational data. Multiple linear regression analysis was used as a testing method. The results obtained leverage and executive compensation affect tax avoidance, conversely capital intensity and advertising expense do not affect tax avoidance.

Leverage as A Mediating Variable on Tax Avoidance

“…Sales growth has no effect on tax avoidance, this proves that the existence of sales growth does not always make companies to do tax avoidance because increasing company growth will cause the tax burden to become smaller so this makes the company not take tax avoidance actions. This is in accordance with research (Permata et al) [14] and (Pratiwiet et al) [5]. Capital intensity uses agency theory because in agency theory the amount of corporate tax is more emphasized and idle company funds will be invested in fixed investment by managers, the goal is to get profits in the form of depreciation expense which can be used to minimize the amount of corporate tax so that taxable profit is low.…”

“…The effect of executive compensation on tax avoidance Executive compensation influence the behavior of avoiding tax, meaning that executives who receive high compensation can increase tax avoidance in a company to be even greater. This hypothesis is supported by (Fatimah et al) [3], (Omega et al) [4], (Pratiwi et al) [5]. From the description, the hypothesis can be shown as follows: H1: Executive compensation has an effect on tax avoidance The effect of executive character on tax avoidance Executive means the holder who get mandate from the owner to achieve the company's goals, so as the executive has the right to make decisions in every business activity.…”

“…Executive compensation is the amount of wages used as a substitute for services to the company, with the aim of motivating, attracting, and retaining employees (Fatimah et al) [3]. Executive compensation has been studied by researchers (Fatimah et al) [3], (Omega et al) [4], (Pratiwi et al) [5], which results in the finding that compensation received by executive influenced the behavior of avoiding tax. However, research (Dewi & Sari) [6] finds that compensation does not have influenced to tax avoidance.…”

“…Later, the other factor that able to affect avoiding tax is the growth of sales. Increasing sales will be able to make the company earn significant interest, therefore companies often practice to avoid taxes (Mahdiana & Amin) [13], whereas (Permata et al) [14] and (Pratiwiet et al) [5] argues that sales growth does not influence on avoiding tax.…”

“…So it can be said that the greater the cost of depreciation that comes out of fixed assets will cause the amount of tax that the company must pay to be smaller. (Mailia and Apollo) [15], (Dharma & Noviari) [16] say if capital intensity affects avoiding the tax, while research conducted by (Puspita & Febrianti) [17] and (Pratiwi et al) [5] say that if capital intensity does not predispose in avoiding tax. Previous studies have shown many inconsistencies in research results.…”