THE INFLUENCES OF CORPORATE GOVERNANCE, PROFITABILITY AND LEVERAGE TO TAX AVOIDANCE
Abstract
The phenomenon of tax avoidance occurs due to difference in interests, for taxpayers, taxes are considered a burden that will reduce income while the government considers taxes as part of income. This difference in interests encourages taxpayers to avoid taxes. Compliance with tax regulations for banking companies can only be met with good corporate governance (GCG) in which all management/agent components within the company carry out their functions to the fullest by prioritizing the interests of the principal/shareholders. Population from this study was taken from banking companies listed on the Indonesia Stock Exchange (IDX) for the period of 2016-2021, selection sample are based on purposive sampling. Independen variables, Corporate governance are measured by three proxies: institutional ownership, number of board directors, number of audit committees; profitability proxied by return on assets (ROA); leverage proxied by debt to equity ratio (DER); while dependent variable use the effective tax rate as proxied for tax avoidance. Research type is quantitative research with a causality approach, techniques analysis for statistical test is used multiple linear regression, data feasibility used classical assumption test, hypothesis test used the Eviews 8.0, and analysis goodness of fit test will be carried out with 3 models: fixed effect, common effect or random effect model. Results shown at t test statistic corporate governance's are not significant influences to tax avoidance, ROA and leverage are negatively influences to tax avoidance; F test statistic shown corporate governance, ROA and leverage are positively influences to tax avoidance with probability value at 0.006<alpha 0.05.
Keywords : corporate governance; profitability; leverage; tax avoidance
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