Detection of Tax Avoidance Due to the COVID-19 Pandemic with the Tax Aggressiveness Model

Abstract

Tax aggressiveness is an action designed to reduce taxable income. Avoidance is done through tax planning. This study aims to analyze indications of tax avoidance with the tax aggressiveness model. Measurements are made by proxy for the abnormal book-tax difference. The way to measure it is by connecting the investment value, changes in income, fiscal, and commercial losses. The manufacturing sector is an important sector for economic recovery. The Ministry of Industry is focused on improving the performance of the five manufacturing sectors to enter the industrial era 4.0. This sector is the pillar of future national economic growth. The five sectors include the food and beverage, textile and clothing, chemical, automotive, and electronics industries. The results of the research are expected to become a reference for policies on economic recovery after the Covid-19 pandemic, especially regarding tax policies.