Title:
The Influence of Institutional Ownership, Earnings Management, Audit Quality, and Leverage on Tax Avoidance in Indonesia

Authors:
Sigit Handoyo, Cici Fatmawati, Indonesia

Abstract:

This study aims to analyze the influence of institutional ownership, earnings management, audit quality, and leverage on tax avoidance practices. The sample consisted of 34 mining companies listed on the Indonesia Stock Exchange (IDX) during the 2021-2023 period. The sample data collection method used purposive sampling, and hypothesis testing was conducted using multiple linear regression. The results show that institutional ownership and audit quality have no effect on tax avoidance, while earnings management has a negative effect on tax avoidance, and leverage has a positive effect on tax avoidance. This study suggests that the greater the level of earnings management, the lower the tax avoidance. Investors should be wary of companies that engage in minimal tax avoidance, as this does not necessarily imply compliance with accounting standards. Furthermore, high leverage can also be a concern for the government, as the corporate tax collector, as it is suspected that higher leverage levels lead to higher levels of tax avoidance.

DOI: https://doi.org/10.51505/IJEBMR.2025.91216