Tax Governance and Risk Mitigation in Applying the Indonesia–Singapore Tax Treaty: A PT PMCS Case Study
DOI:
https://doi.org/10.54518/rh.6.5.2026.1628Keywords:
Agency Theory, Foreign Ownership, Indonesia–Singapore DTAA, International Tax Risk, Tax GovernanceAbstract
Effective corporate tax governance is essential for foreign investment enterprises to navigate complex international tax frameworks and maintain regulatory compliance. This study explores the implementation of corporate tax governance at PT PMCS, evaluates the influence of foreign ownership and the Indonesia–Singapore Double Taxation Avoidance Agreement (DTAA) on tax decisions, and identifies mechanisms to mitigate cross-border tax risks. Utilizing a qualitative single-case study grounded in Agency Theory and Institutional Theory, data were gathered through in-depth interviews with six key informants and triangulated with financial reports (2019–2023) and tax documents. Thematic analysis conducted using NVivo 15 reveals that PT PMCS implements structured tax governance through written policies, clear segregation of duties, and compliance controls. Passive foreign investors grant local management operational autonomy while maintaining supervisory mechanisms, whereas cross-border tax risks are managed through systematic transaction verification and Certificate of Domicile (Form DGT) documentation. This study extends Agency and Institutional theories by explaining how governance mechanisms align investor oversight with local autonomy. The findings offer actionable guidance for multinational enterprises and tax authorities in integrating enterprise risk management with international tax compliance controls.
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