Examination Of Factors Determining Transfer Price In Indonesian Mining Companies
Abstract
The purpose of this study was to examine the effect of firm size, leverage, tax planning, tunneling incentives, intangible assets, and multinationality on the decision to transfer pricing. The research was conducted on mining sector companies listed on the Indonesia Stock Exchange in 2015-2019 by applying multiple linier regression analysis. Samples were obtained by purposive sampling method. Based on the results of the hypotheses in this study, it shows that firm size, leverage, intangible assets, multinationality affect transfer pricing, whereas tax planning and tunneling incentives do not affect transfer pricing. The results have substantial implications for theory as well as practice, in understanding transfer pricing decision, particularly for mining companies.
Keywords: Transfer Pricing; Leverage; Intangible Assets; Multinationality.
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References
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Avri Rahman, W., & Cheisviyanny, C. (2020). Pengaruh Mekanisme Bonus, Exchange Rate, Intangible Assets, dan Kompensasi Rugi Fiskal Terhadap Keputusan Perusahaan Melakukan Transfer Pricing. Jurnal Eksplorasi Akuntansi, 2(3), 3125–3143. https://doi.org/10.24036/jea.v2i3.272
Ayu, G., Surya, R., & Sujana, I. K. (2017). Pengaruh Pajak, Mekanisme Bonus, Dan Tunneling Incentive Pada Indikasi Melakukan Transfer Pricing. E-Jurnal Akuntansi, 19(2), 1000–1029.
Azzura, C. S., & Pratama, A. (2019). Influence of Taxes, Exchange Rate, Profitability, and Tunneling Incentive on Company Decisions of Transferring Pricing. Jurnal Akuntansi Berkelanjutan Indonesia, 2(1), 123. https://doi.org/10.32493/jabi.v2i1.y2019.p123-133
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Chan, K. H., Lo, A. W. Y., & Mo, P. L. L. (2015). An empirical analysis of the changes in tax audit focus on international transfer pricing. Journal of International Accounting, Auditing and Taxation, 24, 94–104. https://doi.org/10.1016/j.intaccaudtax.2014.12.001
Choi, J. P., Furusawa, T., & Ishikawa, J. (2020). Transfer pricing regulation and tax competition. Journal of International Economics, 127. https://doi.org/10.1016/j.jinteco.2020.103367
de Mooij, R., & Liu, L. (2020). At a Cost: The Real Effects of Transfer Pricing Regulations. IMF Economic Review, 68(1), 268–306. https://doi.org/10.1057/s41308-019-00105-0
Devi, D. K., & Suryarini, T. (2020). The Effect of Tax Minimization and Exchange Rate on Transfer Pricing Decisions with Leverage as Moderating. Accounting Analysis Journal, 9(2), 110–115. https://doi.org/10.15294/aaj.v9i2.36469
Firmansyah, A., & Yunidar, A. (2020). Financial Derivatives, Financial Leverage, Intangible Assets, and Transfer Pricing Aggressiveness: Evidence from Indonesian Companies. Jurnal Dinamika Akuntansi Dan Bisnis, 7(1), 1–14. http://jurnal.unsyiah.ac.id/JDAB/article/view/15334/pdf
Gao, L., & Zhao, X. (2015). Determining intra-company transfer pricing for multinational corporations. International Journal of Production Economics, 168, 340–350. https://doi.org/10.1016/j.ijpe.2015.07.006
Hanlon, M., & Slemrod, J. (2009). What does tax aggressiveness signal? Evidence from stock price reactions to news about tax shelter involvement. Journal of Public Economics, 93(1–2), 126–141. https://doi.org/10.1016/j.jpubeco.2008.09.004
Hariaji, N. W., & Akbar, F. S. (2021). Pengaruh multinasionalitas, profitabilitas, ukuran perusahaan, dan leverage terhadap transfer pricing. Seminar Nasional Akuntansi, 1(1), 36–48.
Hartati, W., Desmiyawati, & Julita. (2015). Tax Minimization, Tunneling Incentive dan Mekanisme Bonus terhadap Keputusan Transfer Pricing Seluruh Perusahaan yang Listing di Bursa Efek Indonesia. Simposium Nasional Akuntansi XVIII, 241–246.
Hemling, L., Plesner Rossing, J. C., & Hoffjan, A. (2021). The use of information technology for international transfer pricing in multinational enterprises. International Journal of Accounting Information Systems. https://doi.org/10.1016/j.accinf.2021.100546
Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3(4), 305–360.
Keuschnigg, C., & Devereux, M. P. (2013). The arm’s length principle and distortions to multinational firm organization. Journal of International Economics, 89(2), 432–440. https://doi.org/10.1016/j.jinteco.2012.08.007
Kumar, S., Pandey, N., Lim, W. M., Chatterjee, A. N., & Pandey, N. (2021). What do we know about transfer pricing? Insights from bibliometric analysis. Journal of Business Research, 134, 275–287. https://doi.org/10.1016/j.jbusres.2021.05.041
Maulida, L., & Wahyudin, A. (2021). Determinan Praktik Transfer Pricing Dengan Firm Size Sebagai Pemoderasi Pada Perusahaan Pertambangan Yang Terdaftar Di Bursa Efek Indonesia. Jurnal Akuntansi Bisnis, 18(2), 216. https://doi.org/10.24167/jab.v18i2.3514
Mele, C., Russo-Spena, T., & Kaartemo, V. (2021). The impact of coronavirus on business: developing service research agenda for a post-coronavirus world. Journal of Service Theory and Practice, 31(2), 184–202. https://doi.org/10.1108/JSTP-07-2020-0180
Merle, R., Al-Gamrh, B., & Ahsan, T. (2019). Tax havens and transfer pricing intensity: Evidence from the French CAC-40 listed firms. Cogent Business and Management, 6(1), 1–12. https://doi.org/10.1080/23311975.2019.1647918
Muhammadi, A. H., Ahmed, Z., & Habib, A. (2016). Multinational transfer pricing of intangible assets: Indonesian tax auditors’ perspectives. Asian Review of Accounting, 24(3), 313–337. https://doi.org/10.1108/ARA-10-2014-0112
Nguyen, T. T. (2016). An Investigation of the Vietnamese Shipping Industry and Policy Recommendations for Profound Participation into ASEAN Integration. The Asian Journal of Shipping and Logistics, 32(2), 81–88. https://doi.org/https://doi.org/10.1016/j.ajsl.2016.05.001
Priyanti, D. W., & Suryarini, T. (2021). How Do Trading, Service, and Investment Sector Companies Make Transfer Pricing Decisions? Journal of Accounting and Strategic Finance, 4(1), 1–12. https://doi.org/10.33005/jasf.v4i1.109
Putri, V. R. (2019). Analisis Faktor Yang Mempengaruhi Transfer Pricing Pada Perusahaan Manufaktur Di Indonesia. Jurnal Manajemen Dayasaing, 21(1), 1–11. https://doi.org/10.23917/dayasaing.v21i1.8464
Rego, S. O. (2003). Tax-Avoidance Activities of U.S. Multinational Corporations. Contemporary Accounting Research, 20(4), 805–833. https://doi.org/10.1506/VANN-B7UB-GMFA-9E6W
Richardson, G., & Lanis, R. (2007). Determinants of the variability in corporate effective tax rates and tax reform: Evidence from Australia. Journal of Accounting and Public Policy, 26(6), 689–704. https://doi.org/10.1016/j.jaccpubpol.2007.10.003
Roslita, E. (2020). Pengaruh Pajak , Profitabilitas , Leverage , dan Kualitas Audit terhadap Penetapan Transfer Pricing. Jurnal Manajemen Bisnis, 23(3), 268–274.
Septiyani, P. R. P., Ramadhanti, W., & Sudibyo, Y. A. (2018). Some Factors That Affect Transfer Pricing Decision. Soedirman Accounting Review, 3(1), 21. https://doi.org/10.20884/1.sar.2018.3.1.1158
Solikhah, B., Aryani, D. D., & Widiatami, A. K. (2021). The Determinants of Manufacturing Firms’ Transfer Pricing Decisions in Indonesia. Jurnal Keuangan Dan Perbankan, 25(1), 174–190. https://doi.org/10.26905/jkdp.v25i1.5127
Spence, M. (1973). Job Market Signaling. The Quarterly Journal of Economics, 87(3), 355–374. https://doi.org/https://www.jstor.org/stable/1882010
Susanti, A., & Firmansyah, A. (2018). Determinants of transfer pricing decisions in Indonesia manufacturing companies. Jurnal Akuntansi & Auditing Indonesia, 22(2), 81–93. https://doi.org/10.20885/jaai.vol22.iss2.art1
Waworuntu, S. R., & Hadisaputra, R. (2016). Determinants of Transfer Pricing Aggressiveness in Indonesia. Pertanika J. Soc. Sci. & Hum., 24, 95–110.
Yanti, R. E., & Pratiwi, C. W. (2021). Determinan Transfer Pricing Pada Perusahaan Pertambangan. Jurnal Ilmiah Ekonomi Bisnis, 26(1), 86–98. https://doi.org/10.35760/eb.2021.v26i1.3326
Yunidar, A., & Firmansyah, A. (2020). Financial Derivatives, Financial Leverage, Intangible Assets, and Transfer Pricing Aggressiveness: Evidence from Indonesian Companies. Jurnal Dinamika Akuntansi Dan Bisnis, 7(1), 1–14. https://doi.org/10.24815/jdab.v7i1.15334
Anggraeni, N., & Lutfillah, N. Q. (2019). Determinants of Transfer Pricing. Journal of Management and Business, 18(2), 46–55. https://doi.org/10.24123/jmb.v18i2.428
Anh, N. H., Hieu, N. T., & Nga, D. T. (2018). Determinants of Transfer Pricing Aggressiveness: A case of Vietnam. Southeast Asia Journal of Contemporary Business, Economics and Law, 16(5), 104–112. https://seajbel.com/wp-content/uploads/2018/10/seajbel5_237.pdf
Avri Rahman, W., & Cheisviyanny, C. (2020). Pengaruh Mekanisme Bonus, Exchange Rate, Intangible Assets, dan Kompensasi Rugi Fiskal Terhadap Keputusan Perusahaan Melakukan Transfer Pricing. Jurnal Eksplorasi Akuntansi, 2(3), 3125–3143. https://doi.org/10.24036/jea.v2i3.272
Ayu, G., Surya, R., & Sujana, I. K. (2017). Pengaruh Pajak, Mekanisme Bonus, Dan Tunneling Incentive Pada Indikasi Melakukan Transfer Pricing. E-Jurnal Akuntansi, 19(2), 1000–1029.
Azzura, C. S., & Pratama, A. (2019). Influence of Taxes, Exchange Rate, Profitability, and Tunneling Incentive on Company Decisions of Transferring Pricing. Jurnal Akuntansi Berkelanjutan Indonesia, 2(1), 123. https://doi.org/10.32493/jabi.v2i1.y2019.p123-133
Badan Pusat Statistik. (2021). Quarterly Gross Domestic Product of Indonesia 2017-2021.
Chan, K. H., Lo, A. W. Y., & Mo, P. L. L. (2015). An empirical analysis of the changes in tax audit focus on international transfer pricing. Journal of International Accounting, Auditing and Taxation, 24, 94–104. https://doi.org/10.1016/j.intaccaudtax.2014.12.001
Choi, J. P., Furusawa, T., & Ishikawa, J. (2020). Transfer pricing regulation and tax competition. Journal of International Economics, 127. https://doi.org/10.1016/j.jinteco.2020.103367
de Mooij, R., & Liu, L. (2020). At a Cost: The Real Effects of Transfer Pricing Regulations. IMF Economic Review, 68(1), 268–306. https://doi.org/10.1057/s41308-019-00105-0
Devi, D. K., & Suryarini, T. (2020). The Effect of Tax Minimization and Exchange Rate on Transfer Pricing Decisions with Leverage as Moderating. Accounting Analysis Journal, 9(2), 110–115. https://doi.org/10.15294/aaj.v9i2.36469
Firmansyah, A., & Yunidar, A. (2020). Financial Derivatives, Financial Leverage, Intangible Assets, and Transfer Pricing Aggressiveness: Evidence from Indonesian Companies. Jurnal Dinamika Akuntansi Dan Bisnis, 7(1), 1–14. http://jurnal.unsyiah.ac.id/JDAB/article/view/15334/pdf
Gao, L., & Zhao, X. (2015). Determining intra-company transfer pricing for multinational corporations. International Journal of Production Economics, 168, 340–350. https://doi.org/10.1016/j.ijpe.2015.07.006
Hanlon, M., & Slemrod, J. (2009). What does tax aggressiveness signal? Evidence from stock price reactions to news about tax shelter involvement. Journal of Public Economics, 93(1–2), 126–141. https://doi.org/10.1016/j.jpubeco.2008.09.004
Hariaji, N. W., & Akbar, F. S. (2021). Pengaruh multinasionalitas, profitabilitas, ukuran perusahaan, dan leverage terhadap transfer pricing. Seminar Nasional Akuntansi, 1(1), 36–48.
Hartati, W., Desmiyawati, & Julita. (2015). Tax Minimization, Tunneling Incentive dan Mekanisme Bonus terhadap Keputusan Transfer Pricing Seluruh Perusahaan yang Listing di Bursa Efek Indonesia. Simposium Nasional Akuntansi XVIII, 241–246.
Hemling, L., Plesner Rossing, J. C., & Hoffjan, A. (2021). The use of information technology for international transfer pricing in multinational enterprises. International Journal of Accounting Information Systems. https://doi.org/10.1016/j.accinf.2021.100546
Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3(4), 305–360.
Keuschnigg, C., & Devereux, M. P. (2013). The arm’s length principle and distortions to multinational firm organization. Journal of International Economics, 89(2), 432–440. https://doi.org/10.1016/j.jinteco.2012.08.007
Kumar, S., Pandey, N., Lim, W. M., Chatterjee, A. N., & Pandey, N. (2021). What do we know about transfer pricing? Insights from bibliometric analysis. Journal of Business Research, 134, 275–287. https://doi.org/10.1016/j.jbusres.2021.05.041
Maulida, L., & Wahyudin, A. (2021). Determinan Praktik Transfer Pricing Dengan Firm Size Sebagai Pemoderasi Pada Perusahaan Pertambangan Yang Terdaftar Di Bursa Efek Indonesia. Jurnal Akuntansi Bisnis, 18(2), 216. https://doi.org/10.24167/jab.v18i2.3514
Mele, C., Russo-Spena, T., & Kaartemo, V. (2021). The impact of coronavirus on business: developing service research agenda for a post-coronavirus world. Journal of Service Theory and Practice, 31(2), 184–202. https://doi.org/10.1108/JSTP-07-2020-0180
Merle, R., Al-Gamrh, B., & Ahsan, T. (2019). Tax havens and transfer pricing intensity: Evidence from the French CAC-40 listed firms. Cogent Business and Management, 6(1), 1–12. https://doi.org/10.1080/23311975.2019.1647918
Muhammadi, A. H., Ahmed, Z., & Habib, A. (2016). Multinational transfer pricing of intangible assets: Indonesian tax auditors’ perspectives. Asian Review of Accounting, 24(3), 313–337. https://doi.org/10.1108/ARA-10-2014-0112
Nguyen, T. T. (2016). An Investigation of the Vietnamese Shipping Industry and Policy Recommendations for Profound Participation into ASEAN Integration. The Asian Journal of Shipping and Logistics, 32(2), 81–88. https://doi.org/https://doi.org/10.1016/j.ajsl.2016.05.001
Priyanti, D. W., & Suryarini, T. (2021). How Do Trading, Service, and Investment Sector Companies Make Transfer Pricing Decisions? Journal of Accounting and Strategic Finance, 4(1), 1–12. https://doi.org/10.33005/jasf.v4i1.109
Putri, V. R. (2019). Analisis Faktor Yang Mempengaruhi Transfer Pricing Pada Perusahaan Manufaktur Di Indonesia. Jurnal Manajemen Dayasaing, 21(1), 1–11. https://doi.org/10.23917/dayasaing.v21i1.8464
Rego, S. O. (2003). Tax-Avoidance Activities of U.S. Multinational Corporations. Contemporary Accounting Research, 20(4), 805–833. https://doi.org/10.1506/VANN-B7UB-GMFA-9E6W
Richardson, G., & Lanis, R. (2007). Determinants of the variability in corporate effective tax rates and tax reform: Evidence from Australia. Journal of Accounting and Public Policy, 26(6), 689–704. https://doi.org/10.1016/j.jaccpubpol.2007.10.003
Roslita, E. (2020). Pengaruh Pajak , Profitabilitas , Leverage , dan Kualitas Audit terhadap Penetapan Transfer Pricing. Jurnal Manajemen Bisnis, 23(3), 268–274.
Septiyani, P. R. P., Ramadhanti, W., & Sudibyo, Y. A. (2018). Some Factors That Affect Transfer Pricing Decision. Soedirman Accounting Review, 3(1), 21. https://doi.org/10.20884/1.sar.2018.3.1.1158
Solikhah, B., Aryani, D. D., & Widiatami, A. K. (2021). The Determinants of Manufacturing Firms’ Transfer Pricing Decisions in Indonesia. Jurnal Keuangan Dan Perbankan, 25(1), 174–190. https://doi.org/10.26905/jkdp.v25i1.5127
Spence, M. (1973). Job Market Signaling. The Quarterly Journal of Economics, 87(3), 355–374. https://doi.org/https://www.jstor.org/stable/1882010
Susanti, A., & Firmansyah, A. (2018). Determinants of transfer pricing decisions in Indonesia manufacturing companies. Jurnal Akuntansi & Auditing Indonesia, 22(2), 81–93. https://doi.org/10.20885/jaai.vol22.iss2.art1
Waworuntu, S. R., & Hadisaputra, R. (2016). Determinants of Transfer Pricing Aggressiveness in Indonesia. Pertanika J. Soc. Sci. & Hum., 24, 95–110.
Yanti, R. E., & Pratiwi, C. W. (2021). Determinan Transfer Pricing Pada Perusahaan Pertambangan. Jurnal Ilmiah Ekonomi Bisnis, 26(1), 86–98. https://doi.org/10.35760/eb.2021.v26i1.3326
Yunidar, A., & Firmansyah, A. (2020). Financial Derivatives, Financial Leverage, Intangible Assets, and Transfer Pricing Aggressiveness: Evidence from Indonesian Companies. Jurnal Dinamika Akuntansi Dan Bisnis, 7(1), 1–14. https://doi.org/10.24815/jdab.v7i1.15334
Published
2022-05-28
How to Cite
RAHMAN, Arief; ERNAWATI, Ernawati.
Examination Of Factors Determining Transfer Price In Indonesian Mining Companies.
E-Jurnal Akuntansi, [S.l.], v. 32, n. 5, p. 1200-1212, may 2022.
ISSN 2302-8556.
Available at: <https://ojs.unud.ac.id/index.php/akuntansi/article/view/84973>. Date accessed: 02 nov. 2024.
doi: https://doi.org/10.24843/EJA.2022.v32.i05.p07.
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