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VOL. 10, ISSUE 4 (2025)
The impact of Tax avoidance on corporate social responsibility and profitability
Authors
Aziematul Munawaroh, Aditya Septiani, Etna Nur Afri Yuyetta
Abstract
The study investigates the relationship between tax avoidance, corporate
social responsibility (CSR), and profitability within the banking sector in
Indonesia, focusing on the period from 2021 to 2023. Using a quantitative
research design, the study explores both direct and indirect effects of tax
avoidance on CSR and financial performance. It examines the mechanisms through
which tax avoidance influences a bank’s CSR activities and its financial
outcomes, particularly profitability. The study finds that tax avoidance
negatively impacts CSR, aligning with previous research that suggests
aggressive tax avoidance strategies can tarnish corporate reputation and social
legitimacy. Additionally, the results indicate that while tax avoidance can
improve short-term profitability, it may harm long-term financial
sustainability and reputation. This research provides insights into how banks
in Indonesia navigate the delicate balance between minimizing taxes and
maintaining social responsibility, with significant implications for both
regulators and financial managers.
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Pages:1-5
How to cite this article:
Aziematul Munawaroh, Aditya Septiani, Etna Nur Afri Yuyetta "The impact of Tax avoidance on corporate social responsibility and profitability". International Journal of Advanced Research and Development, Vol 10, Issue 4, 2025, Pages 1-5
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