The effect of corporate social responsibility, firm size, and leverage on tax aggressiveness: An empirical evidence

Abstract

Tax aggressiveness is an interesting research topic in the accounting and management literature. Tax aggressiveness is one of the driving factors in many corporate decisions. Research testing the link between CSR and firm size, leverage to tax aggressiveness is limited and shows inconsistent results. The study aims to test the influence of corporate social responsibility (CSR), firm size, and leverage on tax aggressiveness. The research was conducted in food and beverage sub-sector manufacturing companies listed on the Indonesia Stock Exchange for the period 2017-2019. A sample of 16 companies was determined using the purposive sampling technique. Data in the form of 48 financial statements obtained from the Indonesia Stock Exchange website. The data is analyzed using multiple linear regression analysis techniques, with SPSS 20 software. The results showed that CSR has no significant negative effect on tax aggressiveness; firm size has a significant positive effect on tax aggressiveness; and leverage has a significant negative effect on tax aggressiveness. The results of this study contribute to the financial accounting and taxation literature, especially the discussion of tax aggressiveness and the factors that influence it. Theoretically, the results of this study strengthen stakeholder theory and legitimacy theory. While practically, the results of this study can provide understanding for companies about the factors that can affect tax aggressiveness.