Effect of Related Party Transaction and Tax Haven Utilization on Tax Avoidance Moderated by Country-by-country Reporting
Cesar Samuel Romulo1, Zuliani Dalimunthe2
1Cesar Samuel Romulo, Department Management, University of Indonesia, Central Jakarta, Indonesia.
2Zuliani Dalimunthe, Department Management, University of Indonesia, Central Jakarta, Indonesia.
Manuscript received on 17 July 2023| Revised Manuscript received on 24 July 2023 | Manuscript Accepted on 15 November 2023 | Manuscript published on 30 November 2023 | PP: 91-100 | Volume-3 Issue-2, November 2023 | Retrieval Number: 100.1/ijef.B2551113223 | DOI : 10.54105/ijef.B2551.03021123
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© The Authors. Published by Lattice Science Publication (LSP). This is an open-access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: In 2016, the Government of Indonesia introduced Country-by-Country Reporting through the Minister of Finance Regulation as an implementation of OECD/G20 BEPS Action Plan 13. This study investigates the influence of Related Party Transaction and Tax Haven Utilization on Tax Avoidance with and without Country-by-Country Reporting regulation as the moderating variable. This study uses purposive sampling method as the sample selection. Data in this study is collected from the financial statements of listed 100 MNEs between 2012 and 2021. To test the hypothesis, this study uses pooled OLS regression. The results of this research were Tax Haven Utilization doesn’t have significant effects on Tax Avoidance and Related Party Transaction from Sales have positive and significant effect on Tax Avoidance, meanwhile Related Party Transaction from Assets and Liabilities doesn’t have significant effect on Tax Avoidance. Other results show that Country-by-Country Reporting regulation can not moderate the effect of Related Party Transaction and Tax Haven Utilization on Tax Avoidance. The finding on this study gives recommendation for the government to evaluate the application of CbCR regulations in order to prevent tax evasion through the mechanism of utilizing tax havens and related party transactions and increase theoretical understanding of the application of CBCR.
Keywords: Related Party Transaction, Tax Haven Utilization, Tax Avoidance, Country-by-Country Reporting.
Scope of the Article: Accounting