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Understanding Corporate Tax Avoidance: A Review of Internal and External Influencing Factors
Johan, Adhitakarya Yudha, Iskandar Muda, Erlina
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DOI:10.17265/1548-6583/2025.03.0012
Universitas Sumatera Utara, Medan, Indonesia
This study aims to systematically review the various factors influencing corporate tax avoidance. Tax avoidance refers to legal strategies used to minimize tax liabilities and has become a critical issue in accounting and corporate governance. The study examines key determinants of tax avoidance, including firm characteristics (such as size, leverage, and multinational scale), managerial attributes, executive compensation, ownership structure, corporate social responsibility (CSR) performance, as well as the impact of regulations and legal reforms. The review findings highlight that the motivations behind tax avoidance are multifaceted, driven by the interaction of economic incentives, organizational ethics, external pressures, and public policies. Moreover, strict regulatory environments and strong CSR practices can mitigate tax avoidance behaviors, although their effectiveness is often contingent upon a firm’s cultural and political context. This study offers a comprehensive mapping of the current literature and recommends future research that integrates additional variables and broader time spans to enhance the understanding of tax avoidance behavior across different national contexts.
tax avoidance, determinant
tax avoidance, motivation
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