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This research aims to provide empirical evidence of the effect of foreign ownership on tax avoidance. The dependent variable is tax avoidance as measured by the effective tax rate proxy (ETR), and the independent variable is foreign ownership and uses three control variables. The test uses a sample consisting of 141 companies listed on the Indonesia Stock Exchange in 2017-2019. The results show that foreign ownership has a significant negative effect on tax avoidance, where the greater the foreign ownership, the lower the company’s sign for tax avoidance. The results of the study support the theory of legitimacy, explaining foreign ownership in gaining legitimacy from the community by not avoiding taxation. The implication of this research is that the government can encourage an increase in foreign ownership to optimize tax payments or reduce tax avoidance.
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