ISBN:
9781786350015
Content:
Our study concentrates exclusively on the domestic effective tax rate (ETR), with the purpose of finding and characterizing their financial determinants. Using data on almost 5,000 US companies between fiscal years 2003 and 2010, we use regression analysis to find that the domestic ETR is affected by company size (as measured by sales), the extent to which the company is leveraged, level of fixed assets intensity, and the state of the economy. In addition, we find that domestic ETRs are also affected by the company’s level of internationality, which counterintuitively implies that the greater the company’s international activity, the less domestic taxes it pays for every dollar of US income. Both financial managers and policy makers can use our findings to reduce tax liabilities domestically, and to improve corporate tax regulations. While several attempts are made in the literature to compare ETRs of corporations that reside in different geographic locations, this is the first to characterize ETR determinants.
In:
Advances in taxation, Bingley : Emerald Group Publishing Limited, 2016, (2016), Seite 33-57, 9781786350015
In:
Emerald Group Publishing Limited
In:
year:2016
In:
pages:33-57
Language:
English
DOI:
10.1108/S1058-749720160000023001
URL:
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