The Effect of Tax Avoidance on Firm Value with Tax Risk as Moderating Variable

Abstract

This study aims to examine the effect of corporate tax avoidance and tax risk on firm value. Furthermore, this study examines the moderating effect oftax risk on the relationship between tax avoidance and firm value. This study uses panel data analysisbased on purposive sampling method and involves 124 companies listed in Indonesia Stock Exchange from 2014 - 2017. The results showthat tax avoidance haspositive effect on firm value, tax risk has positive effect on firm value, and tax risk moderates the positive relationship between tax avoidance and firm value. This research also shows robust results using different tax avoidance and tax risk measure.This study makes new contribution in Indonesia related to theassociation between tax risk and firm value, including the effect of moderating taxrisk on the relationship between tax avoidance and firm value.