Corporate Culture, Incentive Systems, and Ethical Threats to Tax Accountants: Implications for Aggressive Tax Planning

Sahat Parlindungan Simarmata

doi:10.59261/inkubis.v8i3.413

Authors

Sahat Parlindungan Simarmata Universitas Trisakti

DOI:

https://doi.org/10.59261/inkubis.v8i3.413

Keywords:

Aggressive Tax Planning, Corporate Culture, Ethical Threats, Incentive Systems, Tax Accountants

Abstract

Background: Indonesia's self-assessment system places tax accountants in a position that is both strategic and ethically vulnerable, yet research on accountants' ethics in Indonesia remains dominated by the external-auditor context and rarely examines the role of organizational factors. The urgency is reflected in a tax ratio of only around 10 percent of GDP, well below the ASEAN (around 14.3 percent) and OECD (around 33.5 percent) averages, alongside still-limited return compliance and audit coverage.

Objective: This conceptual article develops a theoretical framework explaining how corporate culture and incentive systems shape the ethical threats faced by tax accountants and their implications for the tendency toward aggressive tax planning.

Methods: Using a qualitative, literature-based conceptual approach, the article reviews the literature on the professional code of ethics, ethical threats, tax aggressiveness, tax morale, tax compliance, and governance, and synthesizes it into an antecedent-mechanism-consequence framework.

Results: A culture emphasizing short-term financial targets, tolerance of ethical ambiguity, and a results-oriented incentive system can intensify self-interest, advocacy, familiarity, and intimidation threats; conversely, a culture emphasizing integrity, accountability, transparency, governance quality, and balanced performance indicators can strengthen ethical judgment, tax morale, and compliance. The article proposes that the relationship among corporate culture, incentive systems, and aggressive tax planning is mediated by the ethical threats accountants experience during professional decision-making.

Conclusion: Strengthening tax ethics is not sufficient through code-of-ethics training alone; it requires the design of governance, audit committees, performance-evaluation systems, and organizational ethics policies capable of preventing the normalization of aggressive tax practices.

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