How does Financial Performance Moderate the Effect of Corporate Governance Mechanisms on Tax Avoidance?

The recovery in the economic sector due to the COVID-19 pandemic is challenging for all countries, including Indonesia. This study aims to analyze financial performance before and after the Covid-19 pandemic as a moderating variable to see the effect of corporate governance mechanisms on tax avoidance. Financial performance is represented as Return on Assets (ROA) and became a moderating variable, while corporate governance mechanism is represented as institutional ownership and audit committees that influence tax avoidance. The population in this study was 189 manufacturing companies listed on the Indonesia Stock Exchange over the 2019 – 2021 period. The sampling technique in this study was purposive sampling, namely, companies that were consistent and not delisted on the Indonesia Stock Exchange over the 2019-2021 period, including companies that did not experience losses during the 2019-2021 period. This study used panel data regression analysis with Eviews 12.0 program, which was then analyzed through a quantitative approach. The results of the study indicated that institutional ownership has a significant negative effect on tax avoidance, and ROA as the moderator can strengthen the effect of institutional ownership on tax avoidance. While the audit committee also has a significant negative effect on tax avoidance, ROA as the moderator can strengthen the effect of the audit committee on tax avoidance.