THE INFLUENCE OF LEVERAGE, TAX AVOIDANCE, PROFITABILITY, AND CORPORATE GOVERNANCE ON TRANSFER PRICING PRACTICES IN MULTINATIONAL COMPANIES

Abstract

This study aims to analyze the effect of leverage, tax avodaince, profitability, and corporate governance on transfer pricing practices. The study focuses on multinational companies listed on the Indonesia Stock Exchange, using a purposive sampling method that resulted in 100 samples. In this research, the panel data regression model was applied using multiple linear regression analysis to obtain more accurate and relevant results. The findings reveal that only corporate governance has a negative impact on transfer pricing, while leverage, tax avoidance, and profitability do not show any significant influence. The implication of this study is the need to strengthen the implementation of corporate governance in multinational companies as an effort to minimize transfer pricing practices that harm the state in terms of tax revenue. Furthermore, these findings serve as an important consideration for regulators in formulating tax supervision and corporate governance policies.