Prior to the implementation of automatic exchange of information (AEOI), Indonesian government introduced tax amnesty program in 2016 by providing taxpayers with an opportunity to correct their annual tax returns that were previously reported not based on actual condition. This paper attempts to empirically measure the impact of the tax amnesty program on cross-border tax evasion in Indonesia by using changes in deposits owned by Indonesian residents kept in banks located in offshore jurisdictions, or known as cross-border deposits, to proxy for cross-border evasion. Quarterly data on cross-border deposits was obtained from Bank for International Settlement (BIS) Locational Banking Statistics (LBS) from third quarter 2016 until fourth quarter 2017. Using difference-in-difference analysis, our study finds insufficient evidence to suggest that cross-border tax evasion in Indonesia is impacted by the amnesty program. The results also indicate that the government may need to more effectively use the AEOI data received from its partners to investigate whether the taxpayers still commit cross-border tax evasion by hiding their financial assets in offshore financial institutions. This study contributes to academic literature by extending tax literature, specifically about tax evasion and tax amnesty. It also provides insights to regulator about the relationship between tax amnesty and cross-border tax evasion.

Beer, S., Coelho, M. D., & Leduc, S. (2019). Hidden treasure: The impact of automatic exchange of information on cross-border tax evasion. International Monetary Fund.

Boubaker, S., Derouiche, I., & Nguyen, H. (2021). Voluntary Disclosure, Tax Avoidance and Family Firms. Journal of Management and Governance, 26(1), 129–158. https://doi.org/10.1007/s10997-021-09601-w

Brizi, A., Giacomantonio, M., Schumpe, B. M., & Mannetti, L. (2015). Intention to pay taxes or to avoid them: The impact of social value orientation. Journal of Economic Psychology, 50, 22–31. https://doi.org/10.1016/j.joep.2015.06.005

Card, D., & Krueger, A. B. (1994). Minimum wages and employment: A case study of the fast food industry in New Jersey and Pennsylvania. American Economic Review, 84(4), 772–793.

Caruana-Galizia, P., & Caruana-Galizia, M. (2016). Offshore financial activity and tax policy: evidence from a leaked data set. Journal of Public Policy, 36(3), 457–488.

Casi, E., Spengel, C., & Stage, B. M. B. B. (2020). Cross-border tax evasion after the common reporting standard: Game over? In Journal of Public Economics (Vol. 190). Elsevier. https://doi.org/10.1016/j.jpubeco.2020.104240

Darmanti, R. M., & Mangkan, D. (2020). The Implementation of Automatic Exchange of Information as a Tool to Tackle Offshore Tax Evasion: An Experience from Indonesia. Scientax, 2(1), 100–122.

De Simone, L., Lester, R., & Markle, K. (2020). Transparency and tax evasion: Evidence from the foreign account tax compliance act (FATCA). Journal of Accounting Research, 58(1), 105–153.

Dharmapala, D. (2016). Cross-border tax evasion under a unilateral FATCA regime. Journal of Public Economics 141, 29–37.

Directorate General of Taxes. (2017). Strategic Contribution to Building the Nation Through Tax Amnesty; 2016 Annual Report. Jakarta, Indonesia.

Dunn, P., Farrar, J., & Hausserman, C. (2018). The Influence of Guilt Cognitions on Taxpayers’ Voluntary Disclosures. Journal of Business Ethics, 148(3), 689–701. https://doi.org/10.1007/s10551-016-3031-z

Elliot, A. J. (2006). The hierarchical model of approach-avoidance motivation. Motivation and Emotion, 30(2), 111–116. https://doi.org/10.1007/s11031-006-9028-7

Elliot, A. J., & Covington, M. V. (2001). Approach and Avoidance Motivation. Educational Psychology Review, 13(2), 73–92. https://doi.org/10.1023/A:1009009018235

Farrar, J., & Hausserman, C. (2016). An Exploratory Investigation of Extrinsic and Intrinsic Motivations in Tax Amnesty Decision-Making. Journal of Tax Administration, 2(2), 47–66.

Fitriningrum, A. (2015). Are State Owned Enterprises successful vehicles for attaining their governments stated objectives? (The Australian National University). The Australian National University. https://doi.org/10.25911/5d6c402e0158c

Fitriningrum, A. (2020). The Impacts of Government and Managemetn Conflicting Objectives on The State-Owned Enterprises (SOEs) Performances: The Case of Indonesia Publicly Listed SOEs. Jurnal Aplikasi Manajemen, 18(4), 632–644. https://doi.org/10.21776/ub.jam.2020.018.04.03

Fredriksson, A., & Oliveira, G. M. de. (2019). Impact evaluation using Difference-in-Differences. RAUSP Management Journal, 54, 519–532.

Hamilton-Hart, N., & Schulze, G. G. (2016). Taxing Times in Indonesia: The Challenge of Restoring Competitiveness and the Search for Fiscal Space. Bulletin of Indonesian