The Effect of Sales Growth, Responsibility, and Institutional Ownership on Tax Avoidance with Profitability as Moderating Variables

Abstract

This research examines the effect of sales growth, corporate social responsibility, and institutional ownership on tax avoidance in manufacturing companies listed on the Indonesia Stock Exchange from 2016 to 2019. This study relies on secondary data obtained from annual reports obtained from the official website of the Indonesia Stock Exchange, namely www.idx.co.id and www.sahamok.com. The total sampling used is 41 companies for this study. The software used is E-Views 11.0. The findings of this study indicate that corporate social responsibility, profitability, and institutional ownership, which are moderated by profitability, have an impact on tax avoidance. Meanwhile, sales growth had no effect on tax avoidance, and profitability proved unable to balance sales growth and corporate social responsibility in terms of tax avoidance. Good governance is needed to fulfil corporate social responsibility obligations in a company and has been proven to help company management to suppress tax avoidance practices.