Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic
Purpose – This research aims to examine the association between political connection and tax aggressiveness during the COVID-19 pandemic and the role of business ethics in the association between political connection and tax aggressiveness. Design/methodology/approach – This study employs a multiple...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Emerald Publishing
2023-11-01
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| Series: | AJAR (Asian Journal of Accounting Research) |
| Subjects: | |
| Online Access: | https://www.emerald.com/insight/content/doi/10.1108/AJAR-04-2023-0113/full/pdf |
| _version_ | 1797635964077604864 |
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| author | Astrid Rudyanto Julisar Julisar Debora Debora |
| author_facet | Astrid Rudyanto Julisar Julisar Debora Debora |
| author_sort | Astrid Rudyanto |
| collection | DOAJ |
| description | Purpose – This research aims to examine the association between political connection and tax aggressiveness during the COVID-19 pandemic and the role of business ethics in the association between political connection and tax aggressiveness. Design/methodology/approach – This study employs a multiple regression method for 147 manufacturing firms listed on the Indonesia Stock Exchange during the pandemic era. Findings – Political connection has no association with tax aggressiveness. However, political connection has a negative (positive) association with tax aggressiveness in more (less) ethical firms. The results are robust after controlling for year-fixed effects, endogeneity issues and other tax aggressiveness measurements. Originality/value – Political connection is often cited as the driver of unethical business, including tax aggressiveness. However, this paper claims and finds that political connection is a double-edged sword. Ethical firms use political connection to reduce their tax aggressiveness, and vice versa. Previous research has paid little attention to this topic. This paper also uses COVID-19 as a natural experiment to highlight the importance of corporate social responsibility activities as business ethics. |
| first_indexed | 2024-03-11T12:28:32Z |
| format | Article |
| id | doaj.art-49f0c4bc33f24c95afa8d4c86e0912d1 |
| institution | Directory Open Access Journal |
| issn | 2459-9700 2443-4175 |
| language | English |
| last_indexed | 2024-03-11T12:28:32Z |
| publishDate | 2023-11-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | AJAR (Asian Journal of Accounting Research) |
| spelling | doaj.art-49f0c4bc33f24c95afa8d4c86e0912d12023-11-06T05:09:02ZengEmerald PublishingAJAR (Asian Journal of Accounting Research)2459-97002443-41752023-11-018440041010.1108/AJAR-04-2023-0113Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemicAstrid Rudyanto0Julisar Julisar1Debora Debora2Trisakti School of Management, Jakarta, IndonesiaTrisakti School of Management, Jakarta, IndonesiaTrisakti School of Management, Jakarta, IndonesiaPurpose – This research aims to examine the association between political connection and tax aggressiveness during the COVID-19 pandemic and the role of business ethics in the association between political connection and tax aggressiveness. Design/methodology/approach – This study employs a multiple regression method for 147 manufacturing firms listed on the Indonesia Stock Exchange during the pandemic era. Findings – Political connection has no association with tax aggressiveness. However, political connection has a negative (positive) association with tax aggressiveness in more (less) ethical firms. The results are robust after controlling for year-fixed effects, endogeneity issues and other tax aggressiveness measurements. Originality/value – Political connection is often cited as the driver of unethical business, including tax aggressiveness. However, this paper claims and finds that political connection is a double-edged sword. Ethical firms use political connection to reduce their tax aggressiveness, and vice versa. Previous research has paid little attention to this topic. This paper also uses COVID-19 as a natural experiment to highlight the importance of corporate social responsibility activities as business ethics.https://www.emerald.com/insight/content/doi/10.1108/AJAR-04-2023-0113/full/pdfPolitical connectionTax aggressivenessCSR activitiesCOVID-19 |
| spellingShingle | Astrid Rudyanto Julisar Julisar Debora Debora Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic AJAR (Asian Journal of Accounting Research) Political connection Tax aggressiveness CSR activities COVID-19 |
| title | Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic |
| title_full | Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic |
| title_fullStr | Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic |
| title_full_unstemmed | Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic |
| title_short | Political connection as a double-edged sword: the case of tax aggressiveness practice during the COVID-19 pandemic |
| title_sort | political connection as a double edged sword the case of tax aggressiveness practice during the covid 19 pandemic |
| topic | Political connection Tax aggressiveness CSR activities COVID-19 |
| url | https://www.emerald.com/insight/content/doi/10.1108/AJAR-04-2023-0113/full/pdf |
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