Advanced Search
MyIDEAS: Login

Taxation And Corporate Use Of Debt: Implications For Tax Policy

Contents:

Author Info

  • Gordon, Roger H.

Abstract

There is growing empirical evidence showing that taxes encourage use of debt in large profitable firms and discourage it in less profitable firms. There has been debate, though, on the source of any non-tax costs from debt finance offsetting the tax advantages of debt. This paper lays out competing hypotheses, notes that the existing empirical evidence is more supportive of a “lemons” model in which lack of information about the viability of borrowing firms inhibits use of debt, and then explores how tax policy should be designed in response.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.ntanet.org/NTJ/63/1/ntj-v63n01p151-74-taxation-corporate-use-debt.pdf
Download Restriction: no

File URL: http://www.ntanet.org/NTJ/63/1/ntj-v63n01p151-74-taxation-corporate-use-debt.html
Download Restriction: no

Bibliographic Info

Article provided by National Tax Association in its journal National Tax Journal.

Volume (Year): 63 (2010)
Issue (Month): 1 (March)
Pages: 151-74

as in new window
Handle: RePEc:ntj:journl:v:63:y:2010:i:1:p:151-74

Contact details of provider:
Postal: 725 15th St. NW #600. Washington, D.C. 20005-2109
Phone: (202)737-3325
Fax: (202) 737-7308
Email:
Web page: http://www.ntanet.org/
More information through EDIRC

Related research

Keywords:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Stefan Lutz, 2013. "Effects of taxation on European multi-nationals’ financing and profits," Documentos del Instituto Complutense de Análisis Económico 2013-04, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales.
  2. Ruud A. de Mooij & Michael Keen & Masanori Orihara, 2013. "Taxation, Bank Leverage, and Financial Crises," IMF Working Papers 13/48, International Monetary Fund.
  3. Michael Keen & Ruud A. de Mooij, 2012. "Debt, Taxes, and Banks," IMF Working Papers 12/48, International Monetary Fund.
  4. Lars P. Feld & Jost Henrich Heckemeyer & Michael Overesch, 2011. "Capital Structure Choice and Company Taxation: A Meta-Study," CESifo Working Paper Series 3400, CESifo Group Munich.
  5. Francesco Cohen & Alessandro Fedele & Paolo Panteghini, 2014. "Corporate Taxation and Financial Strategies Under Asymmetric Information," CESifo Working Paper Series 4772, CESifo Group Munich.
  6. European Commission, 2013. "Tax reforms in EU Member States - Tax policy challenges for economic growth and fiscal sustainability – 2013 Report," Taxation Papers 38, Directorate General Taxation and Customs Union, European Commission.
  7. Raffaele Miniaci & Paolo Panteghini & Maria Laura Parisi, 2011. "Debt shifting in Europe," Working Papers 1121, Oxford University Centre for Business Taxation.
  8. Florian Scheuer, 2012. "Adverse Selection In Credit Markets and Regressive Profit Taxation," NBER Working Papers 18406, National Bureau of Economic Research, Inc.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ntj:journl:v:63:y:2010:i:1:p:151-74. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Charmaine Wright).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.