Examining Corporate Governance and Corporate Tax Management

Martin Surya Mulyadi, Yunita Anwar and Erminus Bobby Ardo Dwi Krisma
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Martin Surya Mulyadi: Bina Nusantara University, KH Syahdan 9, Jakarta 11480, Indonesia
Yunita Anwar: Bina Nusantara University, KH Syahdan 9, Jakarta 11480, Indonesia
Erminus Bobby Ardo Dwi Krisma: Bina Nusantara University, KH Syahdan 9, Jakarta 11480, Indonesia

International Journal of Finance & Banking Studies, 2014, vol. 3, issue 3, 47-52

Abstract: Taxation playan essential role both in a country and in a corporation. For a country it is one of the primary income source, while for the corporation taxes will reduce corporate net income. To minimize the tax payment, corporation conduct a corporate tax management. According to some of previous research, there is a correlation between corporate governance and corporate tax management. While there are many corporate governance proxies could be used in corporate governance research, in this research we are focusing on three: number of board, number of independent board and board compensation. We measure corporate tax management by using effective tax rate (GAAP ETR and current ETR are used in this research). By using several other control variables, we run the regression and conduct the statistical analysis to examine the correlation between corporate governance and corporate tax management. Our result show that corporate governance have a significant correlation to corporate tax management.

Keywords: Corporate governance; corporate tax management; number of board; independent board; board compensation (search for similar items in EconPapers)
Date: 2014
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