Analysis of Financial Derivative Effects on Tax Avoidance in Non-Financial Companies Listed on The Indonesian Stock Exchange Market (BEI)

DOI

10.2991/apbec-18.2019.27How to use a DOI?

Keywords

Hedging, tax avoidance, financial derivatives, ETR

Abstract

The purpose of this study is to analyze whether companies engaged in financial derivative transactions have higher tax avoidance levels and whether the fair value of financial derivatives affects the levels of tax avoidance. This study uses financial statements of non-financial companies listed in the Indonesian Stock Exchange Market (BEI) between 2011 and 2016. In this study, the tax avoidance is measured by three measurements of the effective tax rate (ETR), namely the ratio of income tax expense, current tax expense, and cash tax which is presented in the statement of cash flow. The results of this study indicate that it is not proven that companies engaged in financial derivative transactions have higher tax avoidance levels than companies that do not engage in financial derivative transactions. The results of this study also prove that the higher the fair value of financial derivatives, the higher the tax avoidance levels are.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Ellis Veronika Sitinjak
AU  - Dwi Martani
PY  - 2019/07
DA  - 2019/07
TI  - Analysis of Financial Derivative Effects on Tax Avoidance in Non-Financial Companies Listed on The Indonesian Stock Exchange Market (BEI)
BT  - Proceedings of the Asia Pacific Business and Economics Conference (APBEC 2018)
PB  - Atlantis Press
SP  - 201
EP  - 212
SN  - 2352-5428
UR  - https://doi.org/10.2991/apbec-18.2019.27
DO  - 10.2991/apbec-18.2019.27
ID  - VeronikaSitinjak2019/07
ER  -