The Effect of CEO Characteristics and Profitability on Tax Aggressiveness in Companies in the Oil and Gas Sector in Indonesia for the 2021-2023 Period

Abstract

Tax aggressiveness is an issue that receives great attention in Indonesia, especially in the oil and gas sector, where companies often take advantage of legal loopholes to reduce their tax burden. This research aims to analyze the influence of CEO characteristics, including educational background, tenure, and gender, as well as profitability on tax aggressiveness in oil and gas companies in Indonesia during the period 2021-2023. This research uses a quantitative method with a panel data regression approach. The sample consists of 67 oil and gas sector companies listed on the Indonesia Stock Exchange (IDX) with a total of 201 observations over three years. Data was obtained from company financial reports and analyzed using EViews software to test the hypothesis through regression testing. The results show that the CEO's educational background and profitability have a significant effect on tax aggressiveness. CEOs with higher educational backgrounds tend to be more compliant with tax regulations and have a lower level of tax aggressiveness. On the other hand, CEO tenure and gender have no significant effect on corporate tax aggressiveness. In addition, companies with higher levels of profitability tend to be more compliant with tax obligations and avoid aggressive tax avoidance strategies. The implication of this research is that companies need to pay attention to the characteristics of CEOs in an effort to reduce tax aggressiveness, especially in the aspects of education and profitability. Company policies in recruiting and developing leaders should consider their academic background.