The Impact Of E-Commerce On Tax Avoidance In Indonesia: Empirical Study On Companies Registered In Indonesia Stock Exchange

Abstract

This paper examines the influence of e-commerce on tax avoidance for companies listed on the Indonesia Stock Exchange (IDX). The research will use quantitative and qualitative methods. The determinants consist of e-commerce, year, the moderation of e-commerce and year, multi-nationality, and intangible assets to tax avoidance aggressiveness with some control variables. The analysis is based on samples of 624 Indonesian firms listed on the Indonesian Stock Exchange (IDX) over 2019-2022 (2472 firm-years). Tax avoidance aggressiveness will be measured using Effective Tax Rates. All models will be processed using panel EGLS (cross-section weights). Regression results show that e-commerce, the moderation of e-commerce and year, multi-nationality, and intangible assets significantly affect tax avoidance aggressiveness. Meanwhile, the year variable does not affect tax avoidance aggressiveness. The qualitative method uses the literature study regarding the effectiveness of Base Erosion Profit Shifting 2.0 regarding the two-pillar approach to tackle challenges arising from the taxation of the digital economy  . The research suggests utilizing its insights to enhance tax authorities' risk analysis, focus on audit processes, and advocate adopting BEPS 2.0 guidelines in Indonesia.