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The Influence of Dividend Policy and Income Tax on Income Smoothing

Author

Listed:
  • Friska Firnanti

    () (Accounting, Trisakti School of Management, Indonesia Author-2-Name: Author-2-Workplace-Name: Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)

Abstract

Objective – This research aims to obtain the empirical evidence on the influence of dividend policy, income tax, firm size, profitability, and leverage on income smoothing. Methodology/Technique – In this research, income smoothing is proxied with the Eckel index and logistic regression is used to test the hypothesis. The research population consists of non-financial companies listed on the Indonesian Stock Exchange from 2013 to 2016. The sampling method used in this research is purposive sampling. The number of companies selected is 79 with 316 data. Findings – The results show that dividend policy, income tax, profitability, and leverage all have an influence on income smoothing. Meanwhile, firm size has no significant influence on income smoothing. Novelty – These findings are consistent with a firm's dividend policy and income tax having an incremental impact on income smoothing behavior. Type of Paper: Empirical.

Suggested Citation

  • Friska Firnanti, 2019. "The Influence of Dividend Policy and Income Tax on Income Smoothing," GATR Journals afr169, Global Academy of Training and Research (GATR) Enterprise.
  • Handle: RePEc:gtr:gatrjs:afr169
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    References listed on IDEAS

    as
    1. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
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    More about this item

    Keywords

    Income Smoothing; Dividend Policy; Income Tax; Firm Size; Profitability; Leverage.;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other

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