Research Paper
Year: 2018 | Month: September | Volume: 5 | Issue: 9 | Pages: 52-60
Tax Avoidance: Evidence of As a Proof of Agency Theory and Tax Planning
Pasca Dwi Putra1, Dedy Husrizal Syah2, Tuti Sriwedari3
1Department of Business Education, Medan State University, Medan, Indonesia,
2Department of Accounting, Medan State University, Medan, Indonesia
3Department of Accounting Education, Medan State University, Medan, Indonesia
Corresponding Author: Pasca Dwi Putra
ABSTRACT
Legal tax planning is mostly done by the company with the aim of reducing the amount of tax paid to the government. The results show that the company tax avoidance in various ways such as increasing the number of fixed assets, increasing the amount of debt, reported losses to get fiscal loss compensation, and conduct earnings reporting management. Tax avoidance in its application to agency theory where there is a conflict of interest between managers as executors and investors. From the results of the research shows, that managers try to reduce the amount of tax paid officially so that the amount of tax paid is also small. The importance of knowledge about the recognition of accounting methods and the assessment of debt assets and income provides an opportunity for managers to reduce the amount of tax paid without violating the applicable rules. Therefore, the need for supervision from the government in making the reporting regulation of financial statements to minimize the practice of tax avoidance in the company.
Key words: Tax Avoidance, Tax Planning, Agency Theory
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