We analyze the effect of investor level taxes, firm-specific ownership structure and firm-specific payout policy on firms' capital structure choice. Our analysis is based on data for 10,983 firms from 13 Central and Eastern European (CEE) countries over the time period 2002-2012. Our results...

The growing dissatisfaction with perceived distributional inequality and budgetary constraints gave rise to a discussion on the (re-)introduction of wealth taxes. Wealth taxes are typically levied on private wealth, in some countries also on corporate wealth. To avoid misleading statements...

This paper analyzes the impact of particular loss offset limitations on intrastate and crossborder investment decisions. Investment can be realized in the investor's domestic business, in a foreign branch or in a foreign subsidiary. The relative impact on the optimal real investment alternative...

In 2005, Austria modified its group taxation regime and now provides an option for crossborder loss-offset. We analyse the combined impact of Austria's new group taxation and lossoffset limitations on cross-border investment decisions of domestic corporations. Monte Carlo simulations in an...

For mitigating the problems of transfer pricing formula apportionment (FA) is discussed intensively. However, FA could even be more harmful than transfer pricing because income shifting would require changing economic decisions instead of just taking advantage of accounting options. We analyze...

Tax legislation, fiscal authorities, and tax courts create tax uncertainty by frequent tax reforms and various different interpretations of the tax law. Moreover, investors generate model-specific tax uncertainty by using simplified models that anticipate the actual tax base incorrectly. I...

The contribution Bach, Corneo, and Steiner (2008) has argued that the rich" do not pay taxes adequately in relation to their income, finding, for instance, an effective tax rate of only 38.1% for the 0.001% fractile of German income taxpayers in 2001. This result contrasts sharply with the...

This paper analyzes the effects of symmetric and asymmetric taxation on performance-based versus fixed remuneration contracts. I integrate a proportional corporation tax and a proportional wage tax into a binary principal-agent model. The wage tax increases the remuneration costs and makes the...

We examine the combined effects of asymmetric taxation and limited liability on optimal risk taking of investors. Given an optimal risk level in the pre-tax case under full liability, loss-offset restrictions reduce, and limited liability enhances the incentives for taking risk. For every degree...

This paper deals with the effects of tax rate uncertainty on risk-neutral and risk-averse investment behavior. We analyze effects of stochastic tax rates on both real and financial investment. It emerges that under risk neutrality as well as under risk aversion, increased tax rate uncertainty...