Tax Office Segmentation and Tax Avoidance in a Developing Economy

Description

Using confidential and anonymous Indonesian income tax return data from 2012-2019, I examine whether the segmentation of tax offices into Large Taxpayers' Tax Offices (LTO) and Medium Taxpayer's Tax Offices (MTO) is associated with the tax avoidance behavior of firms that are administered in those tax offices. I find that firms and comparable firms registered in LTO tend to have larger book-tax differences than those registered in MTO. Robustness check with the scale book-tax difference (SBTD) and GAAP ETR also support my findings. These findings show that even though firms have paid a large amount of taxes, there are always possibilities to do more tax avoidance, despite more supervision or scrutiny by tax authorities, providing insight into the tax avoidance behavior of different size enterprises in emerging countries for accounting researchers and tax authorities.

Period	24 May 2023 → 26 May 2023
Event title	European Accounting Association (EAA), 45th Annual Congress
Event type	Conference
Location	FinlandShow on map
Degree of Recognition	International