Impact of Tax Avoidance, State Ownership, Foreign Ownership, and Firm Size to Firm Value in Indonesia
DOI:
https://doi.org/10.37253/gfa.v7i1.7563Keywords:
Tax Avoidance, State Ownership, Foreign Ownership, Firm Size, Firm ValueAbstract
Purpose - The objectives of the research are to identify and verify the effect of tax avoidance on firm value in Indonesia. State ownership, foreign ownership, company size also influences the value of companies in Indonesia. This study argues that tax avoidance and other elements do not necessarily add value to Indonesian firms.
Research Method - This study uses data from companies registered as LQ45 in the period 2017-2021. Taking the research sample is a purposive sampling method. The population of companies listed on IDX is 810 companies, which 45 companies are included in the LQ45 sample with a total sample data of 225. After conducting outliers, 225 data samples are obtained. This study uses a comparative causal method. Research data processing was executed with the help of the Eviews 10 applications.
Findings - The outcomes of this paper prove that tax avoidance, state ownership and foreign ownership have no significant effect on firm value while firm size has positive effect on firm value.
Implication - This research is expected to contribute to the expansion of knowledge, especially in the field of accounting. The study is intended to provide information about the factors that affect the value of the company and evaluate matters relating to company value.
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References
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Musallam, S. R. M. (2020). State ownership and firm value: simultaneous analyses approach. Journal of Asia Business Studies, 14(1), 50–61. https://doi.org/10.1108/JABS-02-2019-0062
Noerirawan, M. R., & Muid, A. (2012). PENGARUH FAKTOR INTERNAL DAN EKSTERNAL PERUSAHAAN TERHADAP NILAI PERUSAHAAN (Studi Empiris pada Perusahaan Manufaktur yang terdaftar di Bursa Efek Indonesia Periode 2007-2010). Diponegoro Journal Of Accounting, 1(2), 1–12. http://ejournal-s1.undip.ac.id/index.php/accounting
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Rudyanto, A., & Pirzada, K. (2020). The role of sustainability reporting in shareholder perception of tax avoidance. Social Responsibility Journal, 17(5), 669–685. https://doi.org/10.1108/SRJ-01-2020-0022
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Siew Yee, C., Sharoja Sapiei, N., & Abdullah, M. (2018). Tax Avoidance, Corporate Governance and Firm Value in The Digital Era. Journal of Accounting and Investment, 19(2). https://doi.org/10.18196/jai.190299
Tang, T. Y. H. (2019). The Value Implications of Tax Avoidance Across Countries. Journal of Accounting, Auditing and Finance, 34(4), 615–638. https://doi.org/10.1177/0148558X17742821
Thi Thanh Nhan, D., & Ha, P. (2016). International Journal of Economics and Financial Issues Cash Holding, State Ownership and Firm Value: The Case of Vietnam. International Journal of Economics and Financial Issues |, 6(S6), 110–114. http:www.econjournals.com
Wu, W., Rui, O. M., & Wu, C. (2013). Institutional environment, ownership and firm taxation: Evidence from China Wu et al. Institutional Environment, Ownership and Firm Taxation. Economics of Transition, 21(1), 17–51. https://doi.org/10.1111/ecot.12001
Akbari, F., Salehi, M., & Bagherpour Vlashani, M. A. (2019). The relationship between tax avoidance and firm value with income smoothing: A comparison between classical and Bayesian econometric in multilevel models. International Journal of Organizational Analysis, 27(1), 125–148. https://doi.org/10.1108/IJOA-09-2017-1235
Assidi, S., Aliani, K., & Omri, M. A. (2016). Tax optimization and the firm’s value: Evidence from the Tunisian context. Borsa Istanbul Review, 16(3), 177–184. https://doi.org/10.1016/j.bir.2016.04.002
Bryant-Kutcher, L. A., Guenther, D. A., & Jackson, M. (2012). How do cross-country differences in corporate tax rates affect firm value? Journal of the American Taxation Association, 34(2), 1–17. https://doi.org/10.2308/atax-10207
Chen, X., Hu, N., Wang, X., & Tang, X. (2014). Tax avoidance and firm value: evidence from China. Nankai Business Review International, 5(1), 25–42. https://doi.org/10.1108/NBRI-10-2013-0037
Dharmapala, D. (2008). Tax and Corporate Governance. Tax and Corporate Governance, January 2008. https://doi.org/10.1007/978-3-540-77276-7
Fitri, E. R., Savitri, E., & L, A. A. (2019). Influence of Foreign Ownership, Ownership Concentrated, and Environmental Disclosure to Firm Value. Indonesian Journal of Economics, Social, and Humanities, 1(2), 91–96. https://doi.org/10.31258/ijesh.1.2.91-96
Hirdinis, M. (2019). Capital structure and firm size on firm value moderated by profitability. International Journal of Economics and Business Administration, 7(1), 174–191. https://doi.org/10.35808/ijeba/204
Hong Nguyen, T. X., Pham, T. H., Dao, T. N., Nguyen, T. N., & Ngoc Tran, T. K. (2020). The impact of foreign ownership and management on firm performance in Vietnam. Journal of Asian Finance, Economics and Business, 7(9), 409–418. https://doi.org/10.13106/JAFEB.2020.VOL7.NO9.409
Jiraporn, P., Kim, Y. S., Davidson, W. N., & Singh, M. (2006). Corporate governance, shareholder rights and firm diversification: An empirical analysis. Journal of Banking and Finance, 30(3), 947–963. https://doi.org/10.1016/j.jbankfin.2005.08.005
Ilmiani, A., & Sutrisno, C. R. (2014). Pengaruh Tax Avoidance terhadap Nilai Perusahaan dengan Transparansi Perusahaan sebagai Variabel Moderating Amalia Ilmiani Fakultas Ekonomi Universitas Pekalongan Catur Ragil Sutrisno Fakultas Ekonomi Universitas Pekalongan. Jurnal Ekonomi Dan Bisnis, 2(1), 30–39.
Khasawneh, A. Y., & Staytieh, K. S. (2017). Impact of foreign ownership on capital structure & firm value in emerging market: Case of Amman stock exchange listed firms. Afro-Asian Journal of Finance and Accounting, 7(1), 35–64. https://doi.org/10.1504/AAJFA.2017.082928
Khuong, N. V., Liem, N. T., Thu, P. A., & Khanh, T. H. T. (2020). Does corporate tax avoidance explain firm performance? Evidence from an emerging economy. Cogent Business and Management, 7(1). https://doi.org/10.1080/23311975.2020.1780101
Kirkpatrick, A. K., & Radicic, D. (2020). Tax Planning Activities and Firm Value: A Dynamic Panel Analysis. 27(2010), 103–123. https://doi.org/10.1108/s1058-749720200000027004
Likitwongkajon, N., & Vithessonthi, C. (2020). Do foreign investments increase firm value and firm performance? Evidence from Japan. Research in International Business and Finance, 51(June 2019), 101099. https://doi.org/10.1016/j.ribaf.2019.101099
Mangoting, Y., Gunadi, C., Tobing, F. P. D., & Putri, O. A. (2020). Governance Structure, Tax Avoidance, and Firm Value. 158(Teams), 397–407. https://doi.org/10.2991/aebmr.k.201212.056
Liljeblom, E., Maury, B., & Hörhammer, A. (2020). Complex state ownership, competition, and firm performance – Russian evidence. International Journal of Emerging Markets, 15(2), 189–221. https://doi.org/10.1108/IJOEM-08-2017-0287
Mappadang, A. (2019). Do Corporate Governance Mechanism Influences Tax Avoidance and Firm Value? International Journal of Academic Research in Business and Social Sciences, 9(10). https://doi.org/10.6007/ijarbss/v9-i10/6478
Mayer, M. (2019). Tax Avoidance as a Sustainability Problem. Social and Environmental Accountability Journal, 39(3), 205–207. https://doi.org/10.1080/0969160X.2019.1670377
Minh Ha, N. M., Tuan Anh, P., Yue, X. G., & Hoang Phi Nam, N. (2021). The impact of tax avoidance on the value of listed firms in Vietnam. Cogent Business and Management, 8(1). https://doi.org/10.1080/23311975.2021.1930870
Musallam, S. R. M. (2020). State ownership and firm value: simultaneous analyses approach. Journal of Asia Business Studies, 14(1), 50–61. https://doi.org/10.1108/JABS-02-2019-0062
Noerirawan, M. R., & Muid, A. (2012). PENGARUH FAKTOR INTERNAL DAN EKSTERNAL PERUSAHAAN TERHADAP NILAI PERUSAHAAN (Studi Empiris pada Perusahaan Manufaktur yang terdaftar di Bursa Efek Indonesia Periode 2007-2010). Diponegoro Journal Of Accounting, 1(2), 1–12. http://ejournal-s1.undip.ac.id/index.php/accounting
Novarianto, A., & Dwimulyani, S. (2019). Pengaruh Penghindaran Pajak, Leverage, Profitabilitas Terhadap Nilai Perusahaan Dengan Transparansi Perusahaan Sebagai Variabel Moderasi. Prosiding Seminar Nasional Pakar, 1–6. https://doi.org/10.25105/pakar.v0i0.4320
Rudyanto, A., & Pirzada, K. (2020). The role of sustainability reporting in shareholder perception of tax avoidance. Social Responsibility Journal, 17(5), 669–685. https://doi.org/10.1108/SRJ-01-2020-0022
Sciences, M., & Sciences, M. (2020). IMPACT OF TAX AVOIDANCE ON FIRM VALUE AND THE MODERATING ROLE OF CORPORATE GOVERNANCE : EVIDENCE FROM PAKISTAN MANUFACTURING FIRMS * Noroze Khan Naeem Ullah Nida Aman Numair Ahmed Sulehri. 4(2), 122–138. http://inujbm.com/volume-4/Article 1 Volume4 Issue2 2020.pdf
Siew Yee, C., Sharoja Sapiei, N., & Abdullah, M. (2018). Tax Avoidance, Corporate Governance and Firm Value in The Digital Era. Journal of Accounting and Investment, 19(2). https://doi.org/10.18196/jai.190299
Tang, T. Y. H. (2019). The Value Implications of Tax Avoidance Across Countries. Journal of Accounting, Auditing and Finance, 34(4), 615–638. https://doi.org/10.1177/0148558X17742821
Thi Thanh Nhan, D., & Ha, P. (2016). International Journal of Economics and Financial Issues Cash Holding, State Ownership and Firm Value: The Case of Vietnam. International Journal of Economics and Financial Issues |, 6(S6), 110–114. http:www.econjournals.com
Wu, W., Rui, O. M., & Wu, C. (2013). Institutional environment, ownership and firm taxation: Evidence from China Wu et al. Institutional Environment, Ownership and Firm Taxation. Economics of Transition, 21(1), 17–51. https://doi.org/10.1111/ecot.12001
