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Double Dividend Taxation Relief: A New View From The Corporate Income Tax Perspective

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  • Sebastian Lazar

    (Faculty of Economics and Business Administration, "Al. I. Cuza" University, Iasi, Romania)

Abstract

Double taxation of dividends is a matter of great interest in the actual context of globalization and free movement of capital and persons. As the classical system is more and more abandoned, new solutions for the relief of double taxation are put into practice as a mean to reduce the fiscal burden on shareholders. With few exceptions, all these solutions are based on dividend tax relief. The paper aims at providing alternative solutions for double dividend taxation relief by taking some actions on corporate taxation and leaving aside personal income taxation. The goal of the research is to provide a new methodological approach of dividend taxation in various systems of taxation, the results show-ing which system is more suitable and easy to be put into practice. The results showed that the deduction system of dividends when computing taxable profits is the most appropriate for the Romania’s flat tax fiscal framework.

Suggested Citation

  • Sebastian Lazar, 2010. "Double Dividend Taxation Relief: A New View From The Corporate Income Tax Perspective," Analele Stiintifice ale Universitatii "Alexandru Ioan Cuza" din Iasi - Stiinte Economice (1954-2015), Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 57, pages 207-216, november.
    • Handle: RePEc:aic:journl:y:2010:v:57:p:207-216
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    References listed on IDEAS

    as
    1. Miller, Merton H. & Scholes, Myron S., 1978. "Dividends and taxes," Journal of Financial Economics, Elsevier, vol. 6(4), pages 333-364, December.
    2. James M. Poterba & Lawrence H. Summers, 1984. "The Economic Effects of Dividend Taxation," Working papers 343, Massachusetts Institute of Technology (MIT), Department of Economics.
    3. Sorensen, Peter Birch, 1995. "Changing Views of the Corporate Income Tax," National Tax Journal, National Tax Association;National Tax Journal, vol. 48(2), pages 279-294, June.
    4. Sorensen, Peter Birch, 1995. "Changing Views of the Corporate Income Tax," National Tax Journal, National Tax Association, vol. 48(2), pages 279-94, June.
    5. Alan Auerbach & Michael P. Devereux & Helen Simpson, 2007. "Taxing Corporate Income," CESifo Working Paper Series 2139, CESifo.
    6. Mervyn A. King, 1974. "Taxation and the Cost of Capital," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 41(1), pages 21-35.
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    More about this item

    Keywords

    dividend taxation; relief; personal income tax;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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