Capital Structure ………. (Nukman Taufq & Dwipraptono Agus Harjito) 425 INTRODUCTION In corporate fnance literature, one of the most puzzling issues is capital structure theory. As we know from the description of its term, it is implied that the strategy of frm to fnance their assets is through combina- tion of equity, debt, and hybrid securities. By analyzing the factors coming up, the frms can determine what kind of fnancial poli- cies issued. For example, a frm that sells twenty billion rupiah in equity and eighty bil- lion rupiah in debts is said to be 20 % equity fnanced and 80% debt fnanced. The frm’s ratio of debt to total fnancing, for example 80 %, is referred as the frm’s leverage. Forms of capital structure theory, Mo- digliani and Miller who were propounded, begun to be the basis of modern thinking on capital structure. Since many important fac- tors can determine the capital structure de- cision, still this theorem is generally viewed as a purely theoretical result. For instance in their paper, Modigliani and Miller (1958) assume that tax holds big proportions in case dealing with optimizing capital struc- ture, but academicians and professionals consider that this is purely theoretical issue. As leverage increases, the tax advantage of debt eventually will be offset by an in- creased cost of debt, refecting the greater likelihood of fnancial distress. The theorem states that, in a perfect market, how that frm is fnanced the asset affects the value of the frm. This result becomes the base reasons why capital structure is relevant; the capital structure it employs directly in- fuences the company’s value. Debate about a frm’s optimal capi- tal structure in the scope of corporate f- nance concerns keep ongoing. Specifcally, is there a way to separate a frm’s capital into debt and equity so as to maximize the value of the frm? From a practical point of view, this question is of utmost importance for corporate fnancial offcers and also ac- ademicians, as it has been forcefully dem- CAPITAL STRUCTURE ANALYSIS IN THE APPLICATION OF FISCAL , TRADE-OFF AND PECKING ORDER THEORY NUKMAN TAUFIK DWIPRAPTONO AGUS HARJITO Fakultas Ekonomi UII Yogyakarta email:harjitok@yahoo.com ABSTRAK Tujuan yang lebih kongkrit dari penelitian ini adalah untuk menguji relevansi dari teori fskal, te- ori trade-off dan teori peking order dalam analisis struktur modal dari perusahaan-perusahaan publik yang ada di Bursa Efek Indonesia. Dengan menguji teori-teori tersebut di atas akan dip- eroleh informasi empiris tentang penerapan teori-teori tersebut di perusahaan-perusahaan In- donesia. Kemudian, penelitian ini juga menginvestigasi apakah faktor-faktor yang menentukan struktur modal perusahaan dapat mempengaruhi struktur hutangya. Untuk mencapai tujuan yang diinginkan, penelitian ini mengumpulkan data dari perusahaan-perusahaan yang terdaftar di Bursa Efek Indonesia dari tahun 2002 hingga tahun 2006. Dari analisis data ditemukan ba- hwa tarif pajak efektif, struktur asset dan ukuran perusahaan menyebabkan adanya pengaruh positif dan signifkan terhadap rasio hutang perusahaan. Variabel lainnya seperti non debt tax- shield dan nilai proftabilitas periode yang lalu membuat efek negative terhadap rasio hutang. Bagi tingkat pertumbuhan perusahaan, penelitian tidak menemukan hubungannya dengan rasio hutang. Dan variabel-variabel bebas dapat mempengaruhi rasio hutang secara simultan dan secara simultan. Kata Kunci : Fiscal theory, Trade-off Theory, Pecking Order Theory, Capital Structure, and Debt Ratio.