Free Cash Flow as Mediator: Tax Planning, Leverage, and Firm Value in Indonesian Consumer Non-Cyclicals
DOI:
https://doi.org/10.31603/conference.17379Kata Kunci:
cash tax saving, firm value, free cash flow, leverage, panel data regressionAbstrak
This study examines the mediating role of Free Cash Flow (FCF) in the relationships among tax planning, leverage, and firm value in the Consumer Non-Cyclicals sector listed on the Indonesia Stock Exchange (IDX) during 2021-2025. Grounded in Signalling Theory and Agency Theory, this study argues that financial strategy decisions must first translate into tangible cash capacity before being reflected in market valuation. Using purposive sampling, 15 companies were selected, yielding 75 balanced firm-year observations. Tax planning is proxied by Cash Tax Saving (0.22 - Cash ETR), leverage by Debt-to-Equity Ratio (DER), FCF by FCF/Assets, and firm value by Price-to-Book Value (PBV). Panel data regression with cross-section fixed effects and Sobel mediation tests were applied. The results indicate that cash tax saving significantly and positively affects FCF/Assets (beta = 0.5766; p = 0.012), while leverage significantly and negatively affects FCF/Assets (beta = -0.0439; p = 0.020). However, FCF/Assets does not significantly affect PBV (p = 0.249), and the Sobel tests confirm that FCF does not mediate either relationship. The findings suggest that while tax and leverage decisions shape internal cash capacity, market valuation in the Indonesian consumer sector responds to broader signals beyond FCF alone, including sales growth, brand strength, dividend expectations, and long-term earnings stability.
Referensi
Alghifari, E. S., Hermawan, A., Gunardi, A., Rahayu, A., & Wibowo, L. A. (2022). Corporate financial strategy in an emerging market: Evidence from Indonesia. Journal of Risk and Financial Management, 15(8), 362. https://doi.org/10.3390/jrfm15080362
Alomair, M., & Metwally, A. B. M. (2025). Does ESG disclosure matter for the tax avoidance-firm value relationship? Evidence from an emerging market. Sustainability, 17(9), 3836. https://doi.org/10.3390/su17093836
Budiman, S. E. P., & Fitriana, V. E. (2021). The moderating role of corporate governance on the relationship between tax avoidance and firm value. AFRE (Accounting and Financial Review), 4(1), 65-71. https://doi.org/10.26905/afr.v4i1.5973
Bui, T. N., Nguyen, X. H., & Pham, K. T. (2023). The effect of capital structure on firm value: A study of companies listed on the Vietnamese stock market. International Journal of Financial Studies, 11(3), 100. https://doi.org/10.3390/ijfs11030100
Dang, H. N., Vu, V. T. T., Ngo, X. T., & Hoang, H. T. V. (2019). Study the impact of growth, firm size, capital structure, and profitability on enterprise value: Evidence of enterprises in Vietnam. Journal of Corporate Accounting & Finance, 30(1), 144-160. https://doi.org/10.1002/jcaf.22371
Delima, A., & Linawati. (2023). The effect of accounting conservatism, free cash flow and financial distress on company value. Sinergi International Journal of Economics, 1(2). https://doi.org/10.61194/economics.v1i2.78
Ermalini, A., & Badera, I. D. N. (2025). Free cash flow, leverage, and firm value: The moderating role of managerial ownership. Dinasti International Journal of Economics, Finance & Accounting, 6(3), 2434-2445. https://doi.org/10.38035/dijefa.v6i3.4795
Guenther, D. A., Matsunaga, S. R., & Williams, B. M. (2017). Is tax avoidance related to firm risk? The Accounting Review, 92(1), 115-136. https://doi.org/10.2308/accr-51408
Hanlon, M., & Heitzman, S. (2022). Corporate debt and taxes. Annual Review of Financial Economics, 14, 509-534. https://doi.org/10.1146/annurev-financial-101221-103806
Hossain, M. S., Ali, M. S., Islam, M. Z., Ling, C. C., & Fung, C. Y. (2024). Nexus between profitability, firm size and leverage and tax avoidance: Evidence from an emerging economy. Asian Review of Accounting, 32(5), 759-780. https://doi.org/10.1108/ARA-08-2023-0238
Jensen, M. C. (1986). Agency costs of free cash flow, corporate finance, and takeovers. American Economic Review, 76(2), 323-329.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360.
Modigliani, F., & Miller, M. H. (1963). Corporate income taxes and the cost of capital: A correction. American Economic Review, 53(3), 433-443.
Nasution, M. A., Marbun, P., & Syahriandy, H. (2024). The effect of tax planning, leverage, and profitability on firm value in the consumer goods industry sector listed on the Stock Exchange Indonesia year 2019-2023. International Journal of Economic Research and Financial Accounting, 3(1). https://doi.org/10.55227/ijerfa.v3i1.239
Nurdin, F., & Nadia, N. (2022). Factors influencing tax avoidance: An empirical study on the Indonesian Stock Exchange. Journal of Accounting Auditing and Business, 5(2), 57-67. https://doi.org/10.24198/jaab.v5i2.39512
Suryanata, S., & Susanto, L. (2025). Factors affecting firm value in the consumer non-cyclical sector in Indonesia. International Journal of Application on Economics and Business, 3(1), 444-454. https://doi.org/10.24912/ijaeb.v3i1.444-454
Syabila, P. I. S., & Bawono, A. D. B. (2025). The effect of tax planning, profitability, and leverage on company value with company size as a moderating variable. Indonesian Interdisciplinary Journal of Sharia Economics, 8(1), 2094-2109. https://doi.org/10.31538/iijse.v8i1.6048.
Wahyuda, D. A., Falatifah, M., & Karlinah, L. (2025). Pengaruh tax planning, tax avoidance dan leverage terhadap firm value. Owner: Riset dan Jurnal Akuntansi, 9(2), 1005-1019. https://doi.org/10.33395/owner.v9i2.2558.
Wibowo, R. Y. K., Asyik, N. F., & Bambang, S. (2021). Pengaruh struktur kepemilikan, arus kas bebas, ukuran perusahaan terhadap nilai perusahaan melalui struktur modal. EKUITAS (Jurnal Ekonomi dan Keuangan), 5(3), 321-345. https://doi.org/10.24034/j25485024.y2021.v5.i3.4799.
Wijayanti, A. G., Susanto, B., & Pramita, Y. D. (2023). Pengaruh leverage, profitabilitas, ukuran perusahaan, kebijakan dividen, dan likuiditas terhadap nilai perusahaan. Borobudur Accounting Review, 3(1), 11–24. https://doi.org/10.31603/bacr.7751.
