Abstract :

This research aims to examine the effectiveness of Effective Tax Rate, Firm Size, Profitability, Non-Debt Tax Shield, and Moral Hazard toward Capital Structure in oil, gas, and coal subsector firms listed on the Indonesian Stock Exchange during the period 2016-2024. The study employs a quantitative research design using panel data regression analysis. The Fixed Effect Model is selected based on panel data model selection tests and analyzed using EViews 12. The empirical findings reveal that only Profitability has a statistically significant negative effect on Capital Structure. Meanwhile, Effective Tax Rate, Firm Size, Non-Debt Tax Shields, and Moral Hazard do not exhibit statistically significant effects. These results suggest that internal financing capacity plays a more dominant role than tax incentives, firm scale, alternative tax shields, or agency-related considerations in determining capital structure decisions within the observed subsector. These research findings suggest that the effect of internal financing capacity dominates the effect of tax and agency-related considerations in determining Capital Structure within the Indonesian energy subsector. This study is limited by its sector-specific focus and restricted observation period.

---

Keywords :

Capital Structure, Effective Tax Rate, Firm size, Moral Hazard, Non-Debt Tax Shield, profitability

---

References :

1. Alabdulkarim, Nouf. 2023. “Determinants of Capital Structure Evidence from Saudi Arabia.” Journal of Economics, Management and Trade 29 (7): 104–10. https://doi.org/10.9734/jemt/2023/v29i71109.
2. Ali, Sarmad, Adalberto Rangone, and Muhammad Farooq. “Corporate Taxation and Firm-Specific Determinants of Capital Structure: Evidence from the UK and US Multinational Firms.” Journal of Risk and Financial Management 15 (2): 55. https://doi.org/10.3390/jrfm15020055.
3. Ariani, Ni Komang Ayu, and Ni Luh Putu Wiagustini. “Faktor – Faktor Yang Mempengaruhi Struktur Modal Perusahaan Property & Real Estate Yang Terdaftar Di.” E-Jurnal Manajemen Universitas Udayana 6 (6).
4. Benyamin, Prima Luthfinanda, and Subiakto Soekarno. “Capital Structure Determinants of Public Infrastructure Companies in Indonesia.” International Journal of Current Science Research and Review 06 (02). https://doi.org/10.47191/ijcsrr/V6-i2-18.
5. Erwan, Henarani Claudia, and Titis Puspaningrum Dewi Kartika. 2022. “Pengaruh Kepemilikan Manajerial, Non-Debt Tax Shield, Operating Leverage, Cash Holding dan Risiko Bisnis Terhadap Struktur Modal Pada Perusahaan Manufaktur: Keywords: Managerial Ownershi; Non-Debt Tax Shield; Operating Leverage; Cash Holding; Business Risk; Capital Structure.” Jurnal Akuntansi AKUNESA 10 (2): 1–11. https://doi.org/10.26740/akunesa.v10n2.p1-11.
6. Heider, Florian, and Alexander Ljungqvist. 2015. “As Certain as Debt and Taxes: Estimating the Tax Sensitivity of Leverage from State Tax Changes.” Journal of Financial Economics 118 (3): 684–712. https://doi.org/10.1016/j.jfineco.2015.01.004.
7. Jaworski, Jacek, and Leszek Czerwonka. 2021. “Determinants of Enterprises’ Capital Structure in Energy Industry: Evidence from European Union.” Energies 14 (7): 1871. https://doi.org/10.3390/en14071871.
8. Jensen, Michael C., and William H. Meckling. 1976. “Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.” Journal of Financial Economics 3 (4): 305–60. https://doi.org/10.1016/0304-405X(76)90026-X.
9. Kahya, Evrim Hilal, Hüseyin Yiğit Ersen, Cumhur Ekinci, Oktay Taş, and Koray D. Simsek. 2020. “Determinants of Capital Structure for Firms in an Islamic Equity Index: Comparing Developed and Developing Countries.” Journal of Capital Markets Studies 4 (2): 167–91. https://doi.org/10.1108/JCMS-07-2020-0023.
10. Kraus, Alan, and Robert H. Litzenberger. 1973. “A STATE‐PREFERENCE MODEL OF OPTIMAL FINANCIAL LEVERAGE.” The Journal of Finance 28 (4): 911–22. https://doi.org/10.1111/j.1540-6261.1973.tb01415.x.
11. Mardani, Ronny Malavia, Moeljadi, Sumiati, and Nur Khusniyah Indrawati. “The Determinants of Capital Structure: Evidence from Indonesia.” International Journal of Professional Business Review 8 (5): e0878. https://doi.org/10.26668/businessreview/2023.v8i5.878.
12. Modigliani, Franco. 1963. “CORPORATE INCOME TAXES AND THE COST OF CAPITAL: A CORRECTION.” https://api.semanticscholar.org/CorpusID:53523670.
13. Modigliani, Franco, and Merton H. Miller. “The Cost of Capital, Corporation Finance and the Theory of Investment.” The American Economic Review 48 (3): 261–97. JSTOR.
14. Moradi, Amir, and Elisabeth Paulet. 2019. “The Firm-Specific Determinants of Capital Structure – An Empirical Analysis of Firms before and during the Euro Crisis.” Research in International Business and Finance 47 (January): 150–61. https://doi.org/10.1016/j.ribaf.2018.07.007.
15. Myers, Stewart C. 1984. “The Capital Structure Puzzle.” The Journal of Finance 39 (3): 575. https://doi.org/10.2307/2327916.
16. Peter Vaz da Fonseca, Michele Nascimento Jucá, and Wilson. “Debt Tax Benefits in a High Tax Emerging Market: Evidence from Brazil.” International Journal of Economics and Business Administration VIII (Issue 2): 35–52. https://doi.org/10.35808/ijeba/442.
17. Saif-Alyousfi, Abdulazeez Y.H., Rohani Md-Rus, Kamarun Nisham Taufil-Mohd, Hasniza Mohd Taib, and Hanita Kadir Shahar. 2020. “Determinants of Capital Structure: Evidence from Malaysian Firms.” Asia-Pacific Journal of Business Administration 12 (3/4): 283–326. https://doi.org/10.1108/APJBA-09-2019-0202.
18. Saleh, Khairul, and Nuzleha. 2024. ANALISIS RISIKO MORAL, EVALUASI PASAR, DAN PROXIMITAS TERHADAP RISIKO KEBANGKRUTAN: PERUBAHAN STRUKTUR MODAL DI JAKARTA ISLAMIC INDEX (JII).
19. Shkrekova, Elena, and Aleksandar Naumoski. 2024. “Determinants of Capital Structure: Empirical Study of the Industrial Companies in North Macedonia.” December 10, 251–63. https://doi.org/10.47063/EBTSF.2024.0027.
20. Suharsono, and Iwan Setiadi. 2020. “Faktor-Faktor Yang Mempengaruhi Struktur Modal.” FINANSIA : Jurnal Akuntansi Dan Perbankan Syariah 3 (2): 189–212. https://doi.org/10.32332/finansia.v3i2.2117.
21. Valencia, Valencia, and Elizabeth Sugiarto Dermawan. 2024. “THE EFFECT OF SALES GROWTH, FIRM SIZE, PROFITABILITY, BUSINESS RISK ON CAPITAL STRUCTURE.” International Journal of Application on Economics and Business 2 (1): 3095–105. https://doi.org/10.24912/ijaeb.v2i1.3095-3105.
22. Wald, John K. 1999. “HOW FIRM CHARACTERISTICS AFFECT CAPITAL STRUCTURE: AN INTERNATIONAL COMPARISON.” Journal of Financial Research 22 (2): 161–87. https://doi.org/10.1111/j.1475-6803.1999.tb00721.x.
23. Wijaya, Richad. 2024. Factors Affecting Company Capital Structure with Business Risk as a Moderator. 21 (2).
24. Yunira, Haervi. 2022. “Pengaruh Debt Tax Shield dan Efektif Tax Rate Terhadap Struktur Modal Pada Perusahaan Advertising Printing Media.” Owner 6 (2): 1144–56. https://doi.org/10.33395/owner.v6i2.534.