The Moderating Role of Firm Size on the Association between Managerial Ability and Tax Avoidance

Saragih, Arfah Habib; Raya, Mutya Nurmala; Hendrawan, Adang

doi:10.17509/jaset.v13i1.30783

Cited by 5 publications

(5 citation statements)

References 43 publications

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“…The more profit in question can be obtained by avoiding taxes because the less the tax burden paid, the more profit the shareholders will get. The results of this study are in line with Raya and Saragih's (2021) research that managerial ability affects positively tax avoidance and states that more capable managers are found to be associated with greater tax avoidance because they have a better understanding of the business, environment, and opportunities that the company has so that these conditions allow managers to carry out more effective tax avoidance strategies. In addition, this study is also in line with research conducted by Koester et al (2017), who found consistent evidence regarding higher-ability managers engaging in more tax avoidance activities that reduce their company's cash tax payments.…”

Section: Resultssupporting

confidence: 89%

“…Managerial ability is measured using DEA (Analysis Envelopment Data) where DEA and tax aggressiveness have a positive relationship. This is revealed in several studies, one of which is research conducted by Saragih et al (2021) which states that managers with higher abilities tend to be associated with greater tax avoidance because they have a deep understanding of business and opportunities.…”

Section: Managerial Skillsmentioning

confidence: 99%

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The Moderating Role of Investment Opportunities Between Managerial Capability and Tax Aggressiveness

Widuri,

Meviana,

Harianto

2024

j. n.a. akunt. n.a.

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This research was conducted with two objectives, namely to test whether managerial ability can affect corporate tax aggressiveness, and to examine the role of investment opportunities as a moderating variable on the effect of managerial ability and tax aggressiveness. The sample used includes 129 manufacturing companies listed on the Indonesia Stock Exchange during the 2018-2022 period. This study used regression analysis using STATA 18. Managerial ability in this study was measured using the Data Envelopment Analysis (DEA) approach, tax aggressiveness was measured by the Book Tax Differences (BTD) approach and investment opportunities were measured by market to book and capital expenditure. The results of the study found that managerial ability had a positive effect on tax aggressiveness and investment opportunities strengthened the influence between the two. This research contributes to see how investment opportunities moderate and affect managerial ability towards tax aggressiveness. This will be useful for investors where they can view company reports and can be used to show market perceptions of the value of certain shares. There is also where this research contributes so that companies that prepare financial reports can present quality reports and avoid fraud. It also affects investors so that they can read financial reports clearly and use them to show market perceptions of the value of certain shares

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Section: Resultssupporting

confidence: 89%

Section: Managerial Skillsmentioning

confidence: 99%

The Moderating Role of Investment Opportunities Between Managerial Capability and Tax Aggressiveness

Widuri,

Meviana,

Harianto

2024

j. n.a. akunt. n.a.

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“…So, managers with a better level of managerial ability will reduce tax avoidance activities. This study contradicts research conducted by (Akbari et al, 2018;Koester et al, 2017;Nurfauzi & Firmansyah, 2018;Saragih et al, 2021) which shows that there is a positive and significant relationship between managerial ability and tax avoidance.…”

Section: The Influence Of Managerial Ability On Tax Avoidancecontrasting

confidence: 92%

“…However, this study is different from the study (Akbari et al, 2018;Koester et al, 2017;Nurfauzi & Firmansyah, 2018;Saragih et al, 2021) which shows that managerial ability and tax avoidance are positively related. Managers with a higher level of managerial ability will engage in many tax avoidance activities that can reduce the company's cash tax payments.…”

Section: Introductioncontrasting

confidence: 90%

“…Previous research regarding managerial ability can be seen from research (Akbari et al, 2018;Koester et al, 2017;Saragih et al, 2021) which states that there is a positive relationship between managerial ability and tax avoidance. Managers with a higher level of managerial ability will be more involved in tax avoidance actions so that they can reduce the tax rate paid by the company.…”

Section: The Influence Of Managerial Ability On Tax Avoidancementioning

confidence: 99%

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Tax Avoidance: The Role of Managerial Ability and CEO Overconfidence

Tuljannah,

Helmy

2023

WRA

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Purpose – The purpose of this study is to examine the effect of CEO managerial ability and overconfidence on tax avoidance.Design/methodology/approach – The study was conducted on 120 annual reports of mining sector companies listed on the Indonesian Stock Exchange (IDX) from 2017-2021. Multiple regression was used to test the hypotheses. Tax avoidance was measured by CETR. Managerial ability was measured by firm efficiency and CEO overconfidence is measured by five proxies related to company-specific scores.Findings – This study shows that managerial ability has negative significant effect on tax avoidance. The results reveal that CEO overconfidence has no significant effect on tax avoidance. Managers with high managerial ability will not only increase profits in the short term, but also consider the company's survival in the long term, so; they will reduce tax avoidance activities. Meanwhile, CEO's overconfidence cannot influence the tax management that has been determined by the company.Originality/value– This study attempts to fill the gap in the literature about the influence of management attributes on company decision making in tax avoidance activities. This study indicates that the tax avoidance decision in the company cannot be explained by the executive's psychological characteristics only.Research limitations/Implications – This research is limited to how tax avoidance is influenced by managerial ability and overconfidence in decision making with characteristics related to psychological and internal factors. Future research can add other factors such that can influence decision making in conducting tax avoidance, such as rewards, experience, performance measures and other factors. This study has implications in decision making for policymakers in relation to designing future tax systems to reduce the possibility of companies engaging in tax avoidance practices. Companies are also required to be more transparent in disclosing their performance in generating income to avoid tax avoidance activities.Keywords: Managerial ability, overconfidence, tax avoidance.Article Type: Research Paper.

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Is the impact of audit effort on quality of auditors’ performance contingent on virtual audit proficiency? An auditors’ perspective during the COVID-19 pandemic

Al-Ansi

2022

Cogent Business & Management

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The Moderating Role of Firm Size on the Association between Managerial Ability and Tax Avoidance

Cited by 5 publications

References 43 publications

The Moderating Role of Investment Opportunities Between Managerial Capability and Tax Aggressiveness

The Moderating Role of Investment Opportunities Between Managerial Capability and Tax Aggressiveness

Tax Avoidance: The Role of Managerial Ability and CEO Overconfidence

Is the impact of audit effort on quality of auditors’ performance contingent on virtual audit proficiency? An auditors’ perspective during the COVID-19 pandemic

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