Drivers of Tax Aggressiveness: Evidence from Financial Distress and CSR in IDX Mining Firms

ABSTRACT: This study examines the effect of financial distress and corporate social responsibility (CSR) on tax aggressiveness in manufacturing companies within the mining sub-sector listed on the Indonesia Stock Exchange (IDX) from 2021 to 2024. This original research employs a descriptive quantitative approach using secondary data obtained from annual reports and sustainability reports. The sample consists of 20 mining manufacturing companies observed over four years. Data analysis was conducted using SPSS version 22, applying t-tests to assess the partial effects of each variable and an F-test to evaluate their simultaneous influence on tax aggressiveness. The t-test results indicate that financial distress has a significant effect on tax aggressiveness, with a significance value of 0.014 (<0.05). Conversely, CSR does not significantly affect tax aggressiveness, as shown by a significance value of 0.074 (>0.05). The F-test demonstrates that financial distress and CSR together significantly influence tax aggressiveness, with an F-value of 3.817 and a significance level of 0.027 (<0.05). Financial distress is a significant determinant of tax aggressiveness, while CSR does not independently reduce aggressive tax practices. Collectively, both variables significantly influence tax aggressiveness among mining manufacturing companies listed on the IDX.