Gruevski, Ilija and Gaber, Stevan (2014) Corporate Taxation and Investment: The Case of the Split Rate Corporate Tax System in Macedonia. Economic analysis, 47 (3-4). pp. 136-157. ISSN 1821-2573
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Abstract
The majority of experts agree that taxes are distortionary in nature. This is relatively true for all of the different groups of taxes, but for the corporate taxes is exceptionally obvious. The existence of the corporate tax system can affect the company’s behavior in number of ways and one of the most criticized is the ability for distortion of the choice of the sources of finance. In the following article, we explore the effects from corporate taxation on investment, through the
methodological frame of the effective marginal tax rates. The objective is to analyze the investment
decision in the case of isolated implementation of corporate taxes which means that the effects from the
so-called “double taxation”, induced by the personal taxes are not taken in consideration. We hope to
prove that these conditions generate “uneven” distribution of the burden across the projects covered
with different sources of finance. Also, we intend to test and explore the properties of some alternative
corporate tax systems which are widely known as neutral, such as: the comprehensive business income
tax system (CBIT), the imputation corporate tax system (ICT), the full imputation corporate tax
system (FICT), the allowance for corporate equity tax system (ACE) and the split rate corporate tax
system (SRCT). In addition, we support our findings with a practical example: the case study from
the implementation of the split rate corporate tax system in Macedonia.
| Item Type: | Article |
|---|---|
| Additional Information: | COBISS.ID=211785228 |
| Uncontrolled Keywords: | corporate income tax, taxation, cost of capital, effective marginal tax rate, corporate tax system, source of finance, debt, new equity issues, retained earnings |
| Research Department: | ?? H1 ?? |
| Depositing User: | Jelena Banovic |
| Date Deposited: | 30 Jan 2016 00:30 |
| Last Modified: | 30 Jan 2016 00:30 |
| URI: | http://35.240.28.64/id/eprint/363 |
| Author Links: |
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