This paper analyzes the switch from Separate Accounting to Formula Apportionment in a dynamic framework. The model features both purely domestic corporations and a domestic multinational which invests at home and abroad as well as a purely foreign corporation and a foreign multinational which...

Using a firm-level panel data set I assess whether dynamic models of in- vestment provide an empirically fruitful framework for analyzing tax effects on changes in capital stock. In particular I estimate a one-step error correction model (ECM) complementing the usual estimation of a distributed...

There is a lack of clear evidence of the ways in which dividend taxation affects dividend distributions and investment since the evidence is based mainly on the behaviour of large listed companies. This paper utilises a large register-based panel data set, where the vast majority of firms are...

Using a firm-level panel data set I assess whether dynamic models of investment provide an empirically fruitful framework for analyzing tax effects on changes in capital stock. In particular I estimate a one-step error correction model (ECM) complementing the usual estimation of a distributed...

Germany's repeal of the corporate capital gains tax for the disposal of domestic holdings was expected to substantially change the system of corporate network holdings and corporate control. Based on a general divestiture model, we show that the probability of a disposal increased after the tax...

The scientific literature provides evidence for an impact of company taxes on investments. Practitioners, however, have a skeptical view on the meaning of this effect. This paper builds the bridge between research and the interested practice by providing detailed descriptives and clearly showing...

Die finanzwissenschaftliche Theorie hat lange Zeit die Auffassung unterstützt, dass ausländische wie inländische Einkommen besteuert werden sollten (Anrechnungsverfahren). Mittlerweile haben viele empirische Studien ergeben, dass es gesamtwirtschaftlich effizienter sei, ausländische...

We analyze a general business tax in an uncertain economy. Our tax system allows for a time-dependent tax rate and to this end we incorporate a generalized allowance for corporate equity (ACE). The generalized allowance is given by a fraction of the product of interest rate and book value of the...

As any non-lump-sum tax, corporate income taxation creates distortions in economic choices, reducing its efficiency. This paper reviews some of these domestic and international distortions and their most recent estimates from the economic literature. Distortions originating from income shifting...

This paper argues that profit-shifting activities of multi-jurisdictional enterprises (MJE) are maintained under a tax system of consolidation and formula apportionment (FA). A theoretical model discusses how an MJE can exploit its impact on the definition of the consolidated group...