The Effect of Institutional Ownership and CSR as Mediating Variables on Tax Avoidance on Conventional Banks in Indonesia

Abstract

Tax avoidance is a violation by companies with the aim of easing the payment of the tax burden through tax policies made by the State, even though tax avoidance has no legal basis, this will have a negative impact so that the state's income from tax revenues will be reduced, especially in Indonesia. The purpose of this study was to analyze the effect of institutional ownership and CSR as a mediating variable on tax avoidance in conventional banks in Indonesia. The implication of the research that has been done is to provide information for managers, especially financial managers in making decisions and tax avoidance policies that are carried out so that businesses do not harm both internal and external parties. The independent variables of this study are institutional ownership, CSR, and control variables consists of firm size, leverage, and return on assets. While the dependent variable is tax avoidance. The study was conducted by collecting data from 28 conventional banks in Indonesia listed on the Indonesia Stock Exchange in the 2018-2021 period. And using the panel data regression model in the test. The results of this research show that institutional ownership has no effect on tax avoidance. Institutional ownership has negative and significant effect on CSR. CSR has no effect on tax avoidance. Firm size has positive effect on tax avoidance. Leverage has no effect on tax avoidance. Return on assets has positive effect on tax avoidance. The implications of the research conducted can provide information to conventional bank financial managers regarding tax avoidance not to harm many parties. For investors, the information provided can determine whether the bank is paying taxes properly or not.

Factors Influencing Tax Avoidance in Indonesia Mining Company

“…does not want tax avoidance to occur because it reduces the tax revenue received by the government (Aprilia et al, 2020;Pratama and Leon, 2022). This is clarified by Jusman&Nosita (2020) tax avoidance is the efforts of individual or corporate taxpayers by using loopholes and weaknesses in tax legislation to minimize the taxes paid by taxpayers.…”