PENGARUH LIKUIDITAS DAN LEVERAGE TERHADAP TAX AVOIDANCE PADA PERUSAHAAN MANUFAKTUR DI INDONESIA

Abstract

This study aims to empirically examine the effect of liquidity and leverage on tax avoidance practices in manufacturing companies listed on the Indonesia Stock Exchange (IDX). Liquidity is measured using the Current Ratio (CR), while leverage is proxied through the Debt to Equity Ratio (DER). Tax avoidance as the dependent variable is measured using the Cash Effective Tax Rate (CETR). The population in this study covers all manufacturing companies during the 2021-2025 observation period. The sample selection technique used the purposive sampling method, resulting in a total sample of 85 companies with a total of 425 observations over five years. Data analysis was performed using multiple linear regression analysis via SPSS software. The results show that liquidity has a negative and significant effect on tax avoidance. Companies with a high level of liquidity have sufficient cash availability to meet their tax obligations, hence they tend not to engage in tax avoidance. On the other hand, leverage has a positive and significant effect on tax avoidance. The high debt ratio generates massive interest expenses, which are tax-deductible from taxable income, thereby motivating management to minimize corporate tax burdens. Simultaneously, liquidity and leverage significantly affect tax avoidance practices.