Do repatriation taxes matter?: evidence from the tax returns of US multinationals
An open question in the literature on the taxation of multinational corporations is whether repatriation taxes influence whether the profits of foreign subsidiaries are repatriated or reinvested abroad. Theoretical models suggest that dividend remittances should not be influenced by repatriation tax...
Gespeichert in:
| Hauptverfasser: | , , |
|---|---|
| Format: | Buch |
| Sprache: | English |
| Veröffentlicht: |
Cambridge, Mass.
1994
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| Schriftenreihe: | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series
4667 |
| Schlagworte: | |
| Zusammenfassung: | An open question in the literature on the taxation of multinational corporations is whether repatriation taxes influence whether the profits of foreign subsidiaries are repatriated or reinvested abroad. Theoretical models suggest that dividend remittances should not be influenced by repatriation taxes. The results of recent empirical work indicate that dividend remittances are sensitive to repatriation taxes. This paper investigates whether the empirical evidence can be reconciled with the theoretical results by recognizing that repatriation taxes on dividends may vary over time and provide firms with an incentive to time repatriations so that they occur in years when repatriation tax rates are relatively low. We use information about cross-country differences in tax rates to separately estimate the influence of permanent tax changes, as would occur due to changes in statutory tax rates, and transitory tax changes on dividend repatriations. Our data contains U.S. tax return information for a large sample of U.S. corporations and their foreign subsidiaries. We find that the permanent tax price effect is significantly different from the transitory price effect and is not significantly different from zero, while the transitory tax price effect is negative and significant. This suggests that repatriation taxes do affect dividend repatriation behavior but only to the extent that they vary over time. Previous empirical work has apparently measured the effect of timing behavior. |
| Beschreibung: | 30 S. |
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| 245 | 1 | 0 | |a Do repatriation taxes matter? |b evidence from the tax returns of US multinationals |c Rosanne Altshuler ; T. Scott Newlon ; William C. Randolph |
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| 490 | 1 | |a National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |v 4667 | |
| 520 | |a An open question in the literature on the taxation of multinational corporations is whether repatriation taxes influence whether the profits of foreign subsidiaries are repatriated or reinvested abroad. Theoretical models suggest that dividend remittances should not be influenced by repatriation taxes. The results of recent empirical work indicate that dividend remittances are sensitive to repatriation taxes. This paper investigates whether the empirical evidence can be reconciled with the theoretical results by recognizing that repatriation taxes on dividends may vary over time and provide firms with an incentive to time repatriations so that they occur in years when repatriation tax rates are relatively low. We use information about cross-country differences in tax rates to separately estimate the influence of permanent tax changes, as would occur due to changes in statutory tax rates, and transitory tax changes on dividend repatriations. Our data contains U.S. tax return information for a large sample of U.S. corporations and their foreign subsidiaries. We find that the permanent tax price effect is significantly different from the transitory price effect and is not significantly different from zero, while the transitory tax price effect is negative and significant. This suggests that repatriation taxes do affect dividend repatriation behavior but only to the extent that they vary over time. Previous empirical work has apparently measured the effect of timing behavior. | ||
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| 650 | 4 | |a Dividends |x Taxation |x Mathematical models | |
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| 700 | 1 | |a Newlon, T. S. |e Verfasser |4 aut | |
| 700 | 1 | |a Randolph, William C. |e Verfasser |4 aut | |
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| series | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| series2 | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| spelling | Altshuler, Rosanne Verfasser (DE-588)131401939 aut Do repatriation taxes matter? evidence from the tax returns of US multinationals Rosanne Altshuler ; T. Scott Newlon ; William C. Randolph Cambridge, Mass. 1994 30 S. txt rdacontent n rdamedia nc rdacarrier National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 4667 An open question in the literature on the taxation of multinational corporations is whether repatriation taxes influence whether the profits of foreign subsidiaries are repatriated or reinvested abroad. Theoretical models suggest that dividend remittances should not be influenced by repatriation taxes. The results of recent empirical work indicate that dividend remittances are sensitive to repatriation taxes. This paper investigates whether the empirical evidence can be reconciled with the theoretical results by recognizing that repatriation taxes on dividends may vary over time and provide firms with an incentive to time repatriations so that they occur in years when repatriation tax rates are relatively low. We use information about cross-country differences in tax rates to separately estimate the influence of permanent tax changes, as would occur due to changes in statutory tax rates, and transitory tax changes on dividend repatriations. Our data contains U.S. tax return information for a large sample of U.S. corporations and their foreign subsidiaries. We find that the permanent tax price effect is significantly different from the transitory price effect and is not significantly different from zero, while the transitory tax price effect is negative and significant. This suggests that repatriation taxes do affect dividend repatriation behavior but only to the extent that they vary over time. Previous empirical work has apparently measured the effect of timing behavior. Mathematisches Modell Multinationales Unternehmen Steuer Dividends Taxation Mathematical models International business enterprises Taxation United States USA Newlon, T. S. Verfasser aut Randolph, William C. Verfasser aut National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 4667 (DE-604)BV002801238 4667 |
| spellingShingle | Altshuler, Rosanne Newlon, T. S. Randolph, William C. Do repatriation taxes matter? evidence from the tax returns of US multinationals National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series Mathematisches Modell Multinationales Unternehmen Steuer Dividends Taxation Mathematical models International business enterprises Taxation United States |
| title | Do repatriation taxes matter? evidence from the tax returns of US multinationals |
| title_auth | Do repatriation taxes matter? evidence from the tax returns of US multinationals |
| title_exact_search | Do repatriation taxes matter? evidence from the tax returns of US multinationals |
| title_full | Do repatriation taxes matter? evidence from the tax returns of US multinationals Rosanne Altshuler ; T. Scott Newlon ; William C. Randolph |
| title_fullStr | Do repatriation taxes matter? evidence from the tax returns of US multinationals Rosanne Altshuler ; T. Scott Newlon ; William C. Randolph |
| title_full_unstemmed | Do repatriation taxes matter? evidence from the tax returns of US multinationals Rosanne Altshuler ; T. Scott Newlon ; William C. Randolph |
| title_short | Do repatriation taxes matter? |
| title_sort | do repatriation taxes matter evidence from the tax returns of us multinationals |
| title_sub | evidence from the tax returns of US multinationals |
| topic | Mathematisches Modell Multinationales Unternehmen Steuer Dividends Taxation Mathematical models International business enterprises Taxation United States |
| topic_facet | Mathematisches Modell Multinationales Unternehmen Steuer Dividends Taxation Mathematical models International business enterprises Taxation United States USA |
| volume_link | (DE-604)BV002801238 |
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