<![CDATA[This study aims to examine the effect of leverage, company size, and profitability on tax avoidance and examine the role of institutional ownership as a moderating variable in manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the 2022–2024 period. Tax avoidance is proxied using the Effective Tax Rate (ETR), which is the ratio of income tax expense to profit before tax. ETR is inversely proportional to tax avoidance, so a lower ETR indicates a higher level of tax avoidanc , while a higher ETR indicates a lower level of tax avoidance. This study uses a quantitative approach with an explanatory research method. The sample was determined through purposive sampling and resulted in 92 companies with a total of 276 firm-year observations. Hypothesis testing was carried out using multiple linear regression with a Moderated Regression Analysis (MRA) approach through the formation of interaction variables DAR×INST, SIZE×INST, and ROA×INST. The results showed that leverage (DAR) had no significant effect on tax avoidance. Firm size (SIZE) and profitability (ROA) significantly influence ETR with negative coefficients, indicating that increasing firm size and profitability tend to decrease ETR and, since ETR is inversely proportional to tax avoidance, indicate an increase in tax avoidance. Furthermore, institutional ownership does not moderate the effect of leverage on tax avoidance, but is shown to moderate the effect of firm size and profitability on tax avoidance. The positive interaction coefficient indicates that institutional ownership weakens the tendency of larger and more profitable firms to decrease ETR. This finding supports the agency theory perspective that institutional ownership acts as a monitoring mechanism that can suppress opportunistic behavior of management regarding tax strategies.]]>
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