Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper provides an overview of full and partial allowance for corporate equity (ACE) tax systems in practice. In the recent past, ACE systems have been used in Austria, Croatia, and Italy. Brazil still applies a variant of such a system and Belgium introduced one this year. This paper summarizes the empirical literature on past ACE systems, and provides a theoretical and empirical assessment of the Brazilian ACE variant. The main finding is that the Brazilian reform introduced an ACE system for a minority of firms only, with the majority instead having a system of dividend deductibility. Despite the reduction in the tax preference for debt finance, capital structures have not changed much, but dividends have increased. Investment appears to have benefited from the reform, although the extent to which this was due to the new structure rather than the tax cut is unclear.

Corporations -- Finance. --- Corporations -- Taxation. --- Electronic books. -- local. --- Management --- Business & Economics --- Industrial Management --- Corporations --- Finance. --- Taxation. --- Corporate income tax --- Corporate taxes --- Corporation income tax --- Corporation tax --- Federal corporation tax --- Franchises, Taxation of --- Taxation of franchises --- Business finance --- Capitalization (Finance) --- Corporate finance --- Corporate financial management --- Corporation finance --- Financial analysis of corporations --- Financial management, Corporate --- Financial management of corporations --- Financial planning of corporations --- Managerial finance --- Going public (Securities) --- Finance --- Valuation --- Investments: Stocks --- Taxation --- Corporate Taxation --- Business Taxes and Subsidies --- Taxation, Subsidies, and Revenue: General --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- Corporate & business tax --- Public finance & taxation --- Investment & securities --- Allowance for corporate equity --- Stocks --- Income tax systems --- Effective tax rate --- Income tax --- Tax administration and procedure --- Brazil

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper extends the effective average tax rate (EATR) developed in Devereux and Griffith (2003) by relaxing the assumption of a one-period perturbation in the capital stock. Instead it allows a permanent investment. While this may appear a small change, it has important implications. First, it allows the EATR to be calculated in the presence of tax holidays, which are an important part of tax systems, especially in developing countries. Second, it reveals an interesting feature of the original EATR: despite the assumption of a one-period investment, the original measure is informative about long-term investments, thanks to the assumption of pooled depreciation. Without this assumption-which is justifiable in a few countries only- the EATR based on one-period perturbation in the capital stock would be less useful for analyzing medium and long-term investments.

Investments --- Taxation --- Tax rates --- Tax tables --- Investing --- Investment management --- Portfolio --- Finance --- Disinvestment --- Loans --- Saving and investment --- Speculation --- Econometric models. --- Rates and tables. --- Investments: General --- Taxation, Subsidies, and Revenue: General --- Investment --- Capital --- Intangible Capital --- Capacity --- Public finance & taxation --- Macroeconomics --- Depreciation --- Effective tax rate --- Tax holidays --- Average effective tax rate --- Marginal effective tax rate --- Tax administration and procedure --- Tax incentives --- Canada

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Following renewed academic and policy interest in the destination-based principle for taxing profits—particularly through a destination-based cash flow tax (DBCFT)—this paper studies other forms of efficient destination-based taxes. Specifically, it analyzes the Destination-Based Allowance for Corporate Equity (DBACE) and Allowance for Corporate Capital (DBACC). It describes adjustments that are required to turn an origin into a destination-based versions of these taxes. These include adjustments to capital and equity, which are additional to the border adjustments needed under a DBCFT. The paper finds that the DBACC and DBACE reduce profit shifting and tax competition, but cannot fully eliminate them, with the DBACE more sensitve than the DBACC. Overall, given the potential major political cost of switching from an origin to a destination-based tax system, we conclude that advantages of the DBCFT are likely to outweigh the transitional advantages of the DBACE/DBACC.

Banks and Banking --- Investments: Stocks --- Taxation --- Corporate Taxation --- Public Finance --- Efficiency --- Optimal Taxation --- Business Taxes and Subsidies --- Interest Rates: Determination, Term Structure, and Effects --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- Taxation, Subsidies, and Revenue: General --- Corporate & business tax --- Public finance & taxation --- Finance --- Investment & securities --- Allowance for corporate equity --- Value-added tax --- Discount rates --- Stocks --- Corporate income tax --- Taxes --- Financial institutions --- Financial services --- Revenue administration --- Corporations --- Spendings tax --- Discount --- Revenue --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Based on a survey of about 2,500 US resident adults, we show that people who have experienced serious illness or job loss caused by the COVID-19 pandemic, or who personally know someone who has, favor a temporary progressive levy or structural progressive tax reform to a greater extent than others in the sample, controlling for income, demographic characteristics, and other factors. People who reveal preferences for spending items (more on police, military, border protection; less on education, health, environment) that are associated with communitarian (rather than universalist) moral perspectives generally show weaker support for progressive reforms, but more communitarians change their views as a result of personal experience. The results are consistent with previous findings that economic upheavals can mold individuals’ views on policy matters.

Macroeconomics --- Taxation --- Diseases: Contagious --- Personal Income and Other Nonbusiness Taxes and Subsidies --- Taxation and Subsidies: Externalities --- Redistributive Effects --- Environmental Taxes and Subsidies --- Crisis Management --- Health Behavior --- Aggregate Factor Income Distribution --- Education: General --- Health: General --- Taxation, Subsidies, and Revenue: General --- Infectious & contagious diseases --- Education --- Health economics --- Public finance & taxation --- COVID-19 --- Income --- Health --- Progressive taxation --- Communicable diseases --- Tax administration and procedure --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

A growing empirical literature has documented significant profit shifting activities by multinationals. This paper looks at the impact of such profit shifting on real activity and tax competition. Real activity can be affected as profit shifting changes—and theoretically most likely reduces—the cost of capital. Tax competition, even over real capital, is affected, because a permissive attitude toward profit shifting can be seen as a selective tax reduction for multinationals. Tightening profit shifting rules in turn can affect tax competition through the main rate. This paper discusses these issues theoretically and with the help of a simulation to assess the impact of profit-shifting on investment, revenues, and government behavior. Using the theoretical framework, it also provides a brief overview of the related empirical literature.

United States --- Public Finance --- Taxation --- Corporate Taxation --- Taxation, Subsidies, and Revenue: General --- Business Taxes and Subsidies --- Public finance & taxation --- Corporate & business tax --- Thin capitalization rules --- Transfer pricing rules --- Corporate income tax --- Anti-avoidance rules --- Revenue administration --- Taxes --- Double taxation --- Corporations --- Revenue