The Effect of Firm Size, Profitability, and Leverage on Effective Tax Rate: Evidence from Consumer Goods Manufacturing Firms Listed on the Indonesia Stock Exchange (2021–2024)

Rachmad Dwi Riyanto; Yananto Mihadi Putra

doi:10.70550/bisma.v3i1.127

Authors

Rachmad Dwi Riyanto Universitas Mercu Buana, Indonesia Author
Yananto Mihadi Putra Universitas Mercu Buana, Indonesia Author

DOI:

https://doi.org/10.70550/bisma.v3i1.127

Keywords:

Firm Size, Profitability, Leverage, Effective Tax Rate, Manufacturing Companies, Consumer Goods Sub-Sector

Abstract

The effective tax rate (ETR) is a key indicator used to evaluate the actual tax burden borne by companies relative to their pre-tax profits. In many cases, ETR is found to be lower than the statutory tax rate, indicating the presence of lawful tax planning strategies or even tax avoidance practices within the boundaries of regulation. This study aims to examine the effect of firm size, profitability, and leverage on ETR in manufacturing companies within the consumer goods sub-sector listed on the Indonesia Stock Exchange (IDX) during the 2021–2024 period. A purposive sampling method was used to select 21 companies that met the criteria of consistent audited financial reporting, positive pre-tax income, and complete data availability. The research applied a quantitative approach with multiple linear regression analysis using EViews software. The results indicate that firm size, profitability, and leverage each have a significant negative effect on ETR. These findings suggest that corporate fiscal efficiency is largely determined by internal factors, and legal tax planning is an integral part of financial policy aimed at minimizing tax burdens while complying with prevailing regulations. The study contributes to the understanding of how firm characteristics influence tax strategies, providing insights for policymakers and practitioners in designing effective corporate tax policies.

Downloads

Download data is not yet available.

References

Arifin, I., & Andini, R. 2022. Pengaruh Profitabilitas terhadap Effective Tax Rate pada Perusahaan Manufaktur di Indonesia. Jurnal Akuntansi dan Keuangan Indonesia, 19(1), 45–56.

Azhar Susanto. 2013. Sistem Informasi Akuntansi. Bandung: Lingga Jaya.

BEI. 2024. Statistik BEI 2021–2024. Diakses pada 25 Juni 2025 dari World Wide Web: https://www.idx.co.id/data-statistik

Dwi, R. P., & Suryanto, T. 2023. Corparate Governance dan Tax Avoidance: Studi pada Perusahaan Manufaktur Indonesia. Jurnal Keuangan dan Perbankan, 27(1), 99–112.

Halim, A., & Sugianto, M. 2021. Manajemen Pajak: Teori dan Aplikasi. Jakarta: Salemba Empat.

ICBP. 2020. Laporan Tahunan PT Indofood CBP Sukses Makmur Tbk Tahun Buku 2020. Diakses pada 20 Juni 2025 dari World Wide Web: https://ww.indofoodcbp.com

Kieso, D. E., Wygandt, J. J., & Warfield, T. D. 2015. Intermediate Accounting. USA: John Wiley and Sons.

Maulida, L., & Sulistiani, I. 2021. Ukuran Perusahaan dan Effective Tax Rate: Bukti dari BEI. Jurnal Riset Ekonomi dan Bisnis, 14(2), 77–88.

Novita, S., & Fitria, H. 2021. Pengaruh Profitabilitas dan Leverage terhadap Effective Tax Rate. Jurnal Akuntansi Multiparadigma, 12(3), 488–503.

Nugroho, H., & Saputra, R. 2022. Analisis Leverage dan Penghindaran Pajak pada Perusahaan Publik di Indonesia. Jurnal Pajak dan Kuangan Negara, 10(2), 131–143.

Oktaviani, F., & Mawardi, W. 2021. Perencanaan Pajak dan ETR pada Perusahaan Manufaktur. Jurnal Akuntansi Indonesia, 10(1), 55–65.

Pratama, G., & Febrianti, A. 2022. Leverage dan Pengaruhnya terhadap Beban Pajak Efektif. Jurnal Keuangan dan Perpajakan, 18(2), 65–74.

PwC Indonesia. 2021. Tax Planning Trends during the COVID-19. Diakses pada 14 Juni 2024 dari World Wide Web: https://www.pwc.com/id/en/media-centre/publications.html

Putra, R., & Mahardani, D. 2021. Firm Size dan Strategi Pajak Perusahaan di Indonesia. Jurnal Akuntansi dan Auditing, 13(2), 150–164.

Ricardson, G., Taylor, G., & Lanis, R. 2020. The Impact of Financial Leverage on Corporate Tax Avoidance. Journal of International Accounting Research, 19(1), 55–77.

Sari, Y., & Lestari, I. 2023. Leverage dan Tax Avoidance: Studi Empiris pada BEI. Jurnal Pajak dan Akuntansi, 16(3), 101–115.

Sitomorang, D. 2020. Profitabilitas dan ETR: Analisis Perubahan di BEI Tahun Pandemi. Jurnal Akuntansi Aktual, 8(2), 89–97.

Unilever Indonesia. 2020. Laporan Tahunan PT Unilever Indonesia Tbk Tahun Buku 2020. Diakses pada 1 Juni 2024 dari World Wide Web: htpps://www.unilever.co.id/investor-relations

Wibowo, H., & Nurillah, S. 2020. Pengaruh Ukuran Perushaan terhadap Tax Avoidance. Jurnal Riset Keuangan, 9(1), 21–34.

Hanlon, M., & Heitzman, S. (2010). A Review of Tax Research. The Accounting Review, 85(3), 797–840.

Dyreng, S. D., M., & Maydew, E. L. (2008). Long-run corporate tax avoidance. The Accounting Review, 83(1), 61–82.

Armstrong, C. S., Blouin, J. L., Jagolinzer, A. D., & Larcker, D. F. (2002). Corporate Governance, Incentives, and Tax Avoidance. Contemporary Accounting Research, 39(4), 2187–2220.

Watts, R. L., & Zimmerman, J. L. (2020). Positive Accounting Theory. Prentice-Hall Inc.

Barney, J., & Arikan, A. (2021). The Resource-Based View: Origins and Implications. In The Oxford Handbook of Strategy.

Ross, S. A., Wolfson, M. A., Erickson, M., Maydew, E. L., & Shevlin, T. (2021). Taxes and Business Strategy: A Planning Approvach. Pearson Education.

Jensen, M. C., & Murphy, K. J. (2020). Performance Pay and Top-Management Incentives. Journal of Political Economy, 98(2), 225–264.

Mills, L. F., Erickson, M. M., & Maydew, E. L. (2021). Investments in Tax Planning. The Journal of the American Taxation Association, 25(1), 1–20.

Myers, S. C., & Majluf, N. S. (2021). Corporate Financing and Investment Decisions When Firms Have Information That Investor Do Not Have. Journal of Financial Economics, 13(2), 187–221.