Do Audit Quality and Corporate Social Responsibility Influence Tax Avoidance?

DOI

10.2991/978-94-6239-752-1_17How to use a DOI?

Keywords

Audit quality; Corporate Social Responsibility (CSR); Tax avoidance; Agency theory

Abstract

Tax avoidance is a major concern for governments globally, as companies find ways to avoid paying their fair share of taxes, affecting government revenues and justice in the economy. But the biggest problem for governments is to ensure taxpayers’ compliance. This study examines how audit quality and corporate social responsibility (CSR) influence firms’ decisions regarding tax avoidance, viewed through the lens of agency theory. It utilizes a causal quantitative methodology with an explanatory research design to assess the causal effects of the independent variables (audit quality, CSR) on tax avoidance. This study’s sample are Indonesian manufacturing firms. A significant negative relationship was observed between audit quality and tax avoidance. This result is consistent with prior empirical evidence suggesting that Big Four auditors are associated with lower levels of tax avoidance due to stronger monitoring functions that limit managerial opportunism. Conversely, CSR was not found to exert a significant influence on tax avoidance, supporting previous findings reported in the context of Indonesian listed food and beverage firms. Agency theory suggests high-quality audits reduce principal-agent problems and encourage tax compliance. The latter is constrained by poor enforcement and voluntary CSR reporting in emerging markets such as Indonesia. Policy makers need to focus on better audits for aggressive tax avoidance.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Deddy Sulestiyono
AU  - Maya Aresteria
AU  - Alfita Rakhmayani
AU  - Apip Apip
PY  - 2026
DA  - 2026/09/04
TI  - Do Audit Quality and Corporate Social Responsibility Influence Tax Avoidance?
BT  - Proceedings of the9th International Conference on Business, Economics, Social Sciences & Humanities – Economics, Business and Management Track (ICOBEST-EBM 2026)
PB  - Atlantis Press
SP  - 187
EP  - 191
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-752-1_17
DO  - 10.2991/978-94-6239-752-1_17
ID  - Sulestiyono2026
ER  -