In recent years, several countries around the world have been faced with a major recession. A recession is a phenomenon when there is a significant contraction in economic activity over a long period of time. The forecasted slowdown in economic growth to 1.7% in 2023 also reinforces the issue. This is the third weakest pace of economics growth in almost thirty years. According to the World Bank, this recession is expected to be triggered by the pandemic and the global financial crisis (World Bank, 2023). The weakening of the world economy is also caused by the invasion between Russia and Ukraine, which is one of the factors that has a major impact on the international geopolitical climate.

In respones to these conditions, the Indonesian goverment needs a strategy to maintain economic conditions. One of the solutions offered to deal with this recession is to increase state revenue, especially in the field of taxation.

Indonesia has the largest source of revenue which comes from taxes and is used for the prosperity of the people and advancing development. Almost 80% of government revenue comes from tax revenue. Tax is a mandatory or dues that need to be paid by the community as a taxpayer to the state with the nature of a tax that forces that not to get a direct reply and is used for state needs and public prosperity. Taxes become strategic revenues that are properly regulated based on the state’s finnancial structure, the duties and functions of revenues are carried out by the Directorate General of Taxes under the Ministry of Finance of the Republic of Indonesia. According to Vika et al in a journal written by (Arif Fikri Auditama, 2023), the basic of the tax system both at the administrative and policy levels continue to be made by adjusting the dynamics and economic situation. So that this recession is and opportunity as well as a challenge for the Indonesian people, whether the Indonesian people can maintain their economy.

The Value Added Tax (VAT) system introduced in Indonesia in 1984 was set an 10% and remained unchanged until 2021. In 2022, there is increase in the value-added tax (VAT) rate to 11%, while the world average VAT rate is 15%. Following the Organization for Economic Cooperation and Development’s global revenue statistics, Indonesia’s VAT rate is relatively lower than other countries.

The increase in VAT rates will have an impact on the company. The increase in VAT can have an impact on the company’s operating expenses, due to an increase in costs in the use of imported raw materials or subject to VAT on each distribution chain, difficulty in raising prices, and an increase in selling prices so that changes in operating expenses. According to (Jumingan, 2019) business or operational expenses will arise related to the sale of goods or services, administrative and general services at the company. So that changes in operating expenses that occur in each company have an impact on the company’s sales revenue and net profit can

be seen from the difference in operating expenses sales revenue.

In this era of globalization, in the world of business or business the level of competition is getting higher, the ability of business entities survive is not only seen from having good perfomance but companies need to maintain continuity of life in the face of increasingly fierce and high competition with regular and good management and handling. In facing increasingly competitive business competition, every company has a demand to optimize its resources and carry out its efficiently. The company’s goal is to seek profitability or profit. For companies that seek profit to maintain their survival by trying to achieve maximum profit.

One of the factors supporting the survival of the company is profit with details of the comapany’s activity records in the forms of transactions in order to generate profits, classified and then presented with the aim of being a measuring tool for the company’s operational results in a certain period. All companies with large and small scales always shive to make the profits they earn increase. One way that can be taken to obtain optimal profits is to emphasize the operational expenses incured by the company. In general, the size of the operating expenses incured by the company in carrying out is activities is a provision in the acquisition of net profit. This means that the more the costs can be reduced, the impact on increasing the company’s net profit should be.

Net profit is one of the tools to measure the company’s profitability to evaluate management’s ability to get adequate rewards from the use of assets controlled. In general, a company that operates stably is a company that is able to achieve maximum net profit so that it can be a guarantee for the company. According to Halim & Supomo in a journal written by (Fathony & Wulandari, 2020) there are three factors that can affect profitability cost, selling price, and sales volume or production. Based on these three factors, one of the factors that affect the size of the profit earned is cost.

Cost is an important part for companies in carrying out operation that products as a means of obtaining the profits generated. The cost incured in operational finnancing are part of the burden borne by the company so that these costs must be a concern for the company so that the company can maximize the profits generated.

Operating expenses have a big effect on profit, if operating expenses owned by the company are higher, then net profit will decrease. Vice versa, if the operational expenses incured by the company are lower, an increase in the company’s net profit will occur. According to (Fathony & Wulandari, 2020) operational expenses are costs incured to carry out company activies outside of production in order to achieve goals. Operating expenses can be used as a tool increase the profitability pursued by the company.

According to (F. Rahmawati et al., 2021) in order for a company to make a profit, the company needs to emphasize operational expenses to that it is thus clear that one of the factors that affect the profit and loss of a company is operational expenses.

The benchmark for the success of company management and the achievement of net profit is a factor that determines the company’s on going in assessing the level of net profit achieved by a company, so that if the revenue of a company is greater than the operating expenses that have been incured, it means that the company is profitable, while if the revenue earned by the company is less than the expenses that have been incured, it is certain that the company is experiencing a loss.

Companies that make efforts to reduce operating expenses as efficiently as possible try to get profits with the aim that if the expenses incured are greater, it means that profits decrease or vice verse if the company incurs small expenses, it means that profits increase.

According to (L. Rahmawati & Kosasih, 2020) net profit is significantly influenced by operating income and operating expenses. Business income has a very strong relationship with net profit and is directly proportional. Meanwhile, operating expenses are inversely proportional to net profit, meaning that when operating expenses, net profit will decrease.

The object of this reserach is food and beverage companies listed on the Indonesia Stock Exchange (IDX) because most of the products in this industry are basic needs for the comunity. In operationals activities, the food and beverage sub-sector company is a type of company that processes raw material into finished materials in its business activities. Food and beverage sub- sector companies depend on the price and availability of raw materials. So that controling raw material costs is important to maintain its operations. The companies that include of the consumer non-cylical sector was 139.

The criteria for sampling was 1) Companies that listed in consumer non-cylical 2) Companies in the food and beverage sub-sector 3) Companies that report their finnancial statements in 2021-2023; 4) Companies that do not experiencess losses. The data will be used as a research population with sampling based on the criteria was 24.

The results of research conducted by (Muliani Mangngalla, 2024) all companies in the cosmetics sub-sector experienced an increase in sales and gross profit after the increase in VAT rates, but 33% or 2 companies experienced a decrease in net profit after tax and even experienced losses. In research conducted by (Arif Fikri Auditama, 2023) there is a significant difference in the sales value of textile and garment sub-sector companies before and after the increase in value added tax rates. In research conducted by (Muhammad Umar Munawar, 2024) this value added tax increase has a significant effect on the level of sales in 21 manufacturing companies with declining sales and 5 manufacturing companies have an increasing sales level. According to (Muhammad Hidayat et al., 2023) in his research

provides result that 50% of food and beverage industry companies listed on the Indonesia Stock Exchange experienced a decrease in sales after the increase in VAT, 56% of companies decreased gross profit margins but in the same period there were 8 companies that managed to increase profits. The advantage in this study is the novelty of the variables used and this study uses comparison as the analysis model used. The purpose of this study was to determine the differences in sales, operating expenses, and net profit before and after the 11% income tax rate increase.

The research conducted is included in the type of quantitative research. The population in the study consisted of 130 non-cylical consumer sector companies listed on the Stock Exchange. Indonesia Stock Exchange (IDX). The sample selection process focused on identifying companies that were continuously listed from 2021 to 2023. Only companies that are included in the food and beverage sub-sector companies. In , companies that did not experience losses from 2021 to 2023. Using purposive sampling, a final sample of 24 companies was selected from an initial population of 130 companies in the consumer non- cyclical sector.

The data source in this study is secondary data collected using documentation techniques. This technique involves collecting and storing financial statement data from the consumer non-cylical sector listed on the Indonesia Stock Exchange (IDX). To analyze the comparison before and after the 11% value-added tax (VAT) rate increase, this study used a comparative method with a paired sample test. Hypothesis testing was also carried out using SPSS version 22 statistical software.

The variables used in the study consisted of sales, operating costs, and net income. The research begins with a search for data related to Non- Primary Consumer Sector Companies on the Indonesia Stock Exchange, then elimination is carried out so as to produce more specific data, namely food and beverage sub-sector companies.

Furthermore, the financial statements of each company in a 2-year period were analyzed. The analysis focuses on the imposition of value added tax (VAT) which has an impact on sales, operating costs and net profit variables.

The world economy is in the midst of a major recession, an issue supported by an estimated slowdown in economic growth to 1.7% by 2023.

The pandemic, the global crisis, and the invasion of Russia and Ukraine are among the factors that have had a major impact on international geopolitics. In response to these conditions, the Indonesian government has implemented a strategy by establishing a new policy, namely increasing state revenue, especially in the field of taxation. Officially in April 2022 in Law No. 7 of 2021 concerning harmonization of taxation which contains several changes to taxation rules, one of which is a change in value added tax rates.

Based on the results of research and discussion of the comparison of sales, operating costs and net income before and after the 11% tax increase in food and beverage sub-sector companies listed on the Indonesia Stock Exchange, it can be concluded that according to the results of hypothesis testing using the paired sample test there is a difference in sales before and after the VAT increase because the VAT increase has an impact on the increase in selling prices, resulting in consumers reducing or even not making purchases. Then, there is a difference in operating costs before and after the VAT increase because VAT is attached to the price of raw materials that the company will purchase, resulting in an increase in the cost of goods manufactured. The increase in the cost of goods produced has an impact on increasing operating costs. And the last, there is no difference in net profit before and after the VAT increase. This is because the company's profit is not directly related to changes in VAT because it has been calculated at the time of operational costing and the company's profit is more dominantly influenced by changes in income tax.