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The Effect of Tax Avoidance, Tax Rate Change, and Sustainability Disclosure on Earnings Management

Author

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  • I Putu Hendy Bimantara Dinata
  • Asqolani

    (Politeknik Keuangan Negara STAN, Banten, Indonesia)

Abstract

This study aims to analyze the effect of tax avoidance, changes in tax rates, and sustainability disclosures on earnings management. The sample in this study is public companies listed on the IDX for the period 2018–2021. The results of this study indicate that tax avoidance has no effect on earnings management. In addition, after the reduction in the corporate income tax rate, companies tend to conduct earnings management to reduce revenue. In the sustainability aspect, environmental sustainability disclosure has no effect on earnings management, while social sustainability disclosure has a positive effect on earnings management. The results of this study can be a consideration for the DGT and OJK in evaluating policies to reduce corporate tax rates, and sustainability disclosures.

Suggested Citation

  • I Putu Hendy Bimantara Dinata & Asqolani, 2024. "The Effect of Tax Avoidance, Tax Rate Change, and Sustainability Disclosure on Earnings Management," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 70, pages 34-48, June.
    • Handle: RePEc:lpe:efijnl:202403
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    earnings management; sustainability disclosure; tax avoidance; tax rate changes;
    All these keywords.

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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