Citation:

Raden Roro Diana Atika Ghozali, Benediktus Gerry Widjanarko, Naila Hanum, Rissa Anandita. "Tax Efficiency and Capital Structure Dynamics in Family Firms: Impact On Dividend Payouts" International Research Journal of Economics and Management Studies, Vol. 5, No. 8, pp. 54-60, 2026. Crossref. https://doi.org/10.56472/25835238/IRJEMS-V5I8P105

Abstract:

This study investigates the role that tax efficiency, capital structure dynamics and dividend payout policies play in a context of emerging market manufacturing firms while assessing family ownership as an instrumental moderator. Based on agency and pecking order theories, the study deals with restrictiveness of financial leverage and tax manipulation within family-owned corporate contexts. The empirical model uses multiple linear regression and Moderated Regression Analysis (MRA) with robust error adjustment on panel data among 93 manufacturing firms listed in the Indonesia Stock Exchange (IDX), for the period of 2022-2024, producing a total number of firm-year observations equal to270. The results show that Effective Tax Rate (ETR) is not statistically significant, exerting a negative impact, which suggests that long-term debt liabilities do place limitations on dividends paid. In addition to this, family ownership does not moderate either tax efficiency-dividend links or capital structure-dividends relationships. This evidence supports the argument that dividend policies in emerging manufacturing sectors are driven more by aspirations to service debt than maximize tax efficiency, or preserve socioemotional wealth. This study provides crucial ramifications for corporate managers and investors, emphasizing that financial leverage management serves as the critical determinant of shareholder returns in family-influenced emerging markets.

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Keywords:

Dividend Policy, Family Business, Leverage, Tax Management.