The Effect of Corporate Diversification, Customer Concentration on Tax Avoidance in Indonesia

Putra Aryotama, Amrie Firmansyah

Abstract


This study aims to examine the effect of corporate diversification, customer concentration on tax avoidance in Indonesia’ Non-Financial Companies. Companies diversify because of the private benefits managers receive from diversifying. Also, Companies may choose to have only a few customers to create a close relationship with those customers. Meanwhile, tax avoidance is a reduction in corporate tax liability, which is conducted by the company legally. This study employs a quantitative method using linear regression analysis and uses panel data of companies listed under the Indonesian Non-Financial Companies on IDX from 2014 to 2017. Based on purposive sampling was conducted, the total number of observations is 483 firm-year. The results of this study suggest that corporate diversification and customer concentration are positively associated with tax avoidance.
Keywords: Diversification, Concentration, Non-Financial Companies, Tax Avoidance

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DOI: http://dx.doi.org/10.20961/jab.v19i2.475

Jurnal Akuntansi dan Bisnis (JAB)
ISSN 1412-0852 (print), 2580-5444 (online)
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