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Author : Trevor S. Harris
Publisher :
ISBN 13 :
Total Pages : 50 pages
Book Rating : 4.:/5 ( download)
Download or read book Dividend and Capital Gains Taxation in Firm Valuation : New Evidence written by Trevor S. Harris and published by . This book was released on 1997 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Alan J. Auerbach
Publisher :
ISBN 13 :
Total Pages : 10 pages
Book Rating : 4.:/5 (255 download)
Download or read book Dividend Taxes and Firm Valuation written by Alan J. Auerbach and published by . This book was released on 2006 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper extends our previous analysis (Auerbach and Hassett 2005) of the effects of the "Jobs and Growth Tax Relief Act of 2003" on firm valuation. That paper found that firms with higher dividend yields benefited more than other dividend paying firms, a result that, in itself, is consistent with both new and traditional views of dividend taxation. But further evidence favored the new view. We also found that non-dividend-paying "immature" firms experienced larger abnormal returns than other firms and that a similar bonus accrued to firms likely to issue new shares, two results that are consistent with an anticipated transition to higher dividend payments. Here, we extend our earlier analysis in two ways. First, we consider the impact of the 2004 Presidential election on option prices, to gain further insight into and confirmation of the mechanism through which the 2003 legislation affected firm values. Second, we explore in more detail the determinants of the "immaturity premium" noted above. In contrast to claims in a recent paper by Amromin et al. (2005), we find that the premium is associated with the likelihood of new share issuance, as inferred but not demonstrated in our original analysis.
Author : James M. Poterba
Publisher :
ISBN 13 :
Total Pages : 39 pages
Book Rating : 4.:/5 (129 download)
Download or read book New Evidence that Taxes Affect the Valuation of Dividends written by James M. Poterba and published by . This book was released on 2010 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper uses British data to examine the effects of dividend taxes on investors' relative valuation of dividends and capital gains. British data offer great potential to illuminate the dividends and taxes question, since there have been two radical changes and several minor reforms in British dividend tax policy during the last twenty-five years. Studying the relationship between dividends and stockprice movements during different tax regimes offers an ideal controlled experiment for assessing the effects of taxes on investors' valuation of dividends. Using daily data on a small sample of firms, and monthly data on a much broader sample, we find clear evidence that taxes change equilibrium relationships between dividend yields and market returns. These findings suggest that taxes are important determinants of security market equilibrium, and deepen the puzzle of why firms pay dividends.
Author : Leonie Bell
Publisher :
ISBN 13 :
Total Pages : 44 pages
Book Rating : 4.X/5 (6 download)
Download or read book New Evidence of the Impact of Dividend Taxation and on the Identity of the Marginal Investor written by Leonie Bell and published by . This book was released on 2001 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : John Karl Scholz
Publisher :
ISBN 13 :
Total Pages : 276 pages
Book Rating : 4.F/5 ( download)
Download or read book The Effect of the Relative Tax Treatment of Dividends and Capital Gains on Corporate Valuation and Behavior written by John Karl Scholz and published by . This book was released on 1988 with total page 276 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : David Laro
Publisher : John Wiley & Sons
ISBN 13 : 0471709956
Total Pages : 482 pages
Book Rating : 4.4/5 (717 download)
Download or read book Business Valuation and Taxes written by David Laro and published by John Wiley & Sons. This book was released on 2005-04-22 with total page 482 pages. Available in PDF, EPUB and Kindle. Book excerpt: Disputes over valuation issues fill the court's dockets and for good reason, fair market valuations are required frequently by the law. The authors believe that approximately 243 sections of the Code and several thousand references in the Regulations explicitly require fair market value determination. Consequently, taxpayers file an estimated 15 million tax returns each year reporting an event involving a valuation related issue. It is no mystery, therefore, why valuation cases are ubiquitous. Today, valuation is an important and highly sophisticated process. Valuators need legitimate guidance to perform their work. The objective of this book is to provide knowledge, and guidance to those who do the valuations as well as those who are affected by them. This unprecedented text provides: Clear guidance and perspective on business valuation from two of the nation’s top authorities, Hon. David Laro and Dr Shannon Pratt. Insightful perspective and discussion on critical issues, procedures and law pertaining to business valuation. An overview of business valuation procedures Law and techniques of Fair Market Value Opinion from the Hon. David Laro and Dr. Shannon Pratt who express their unique and critical views. The business valuer with everything from the basics to the sophisticated. From definitions to valuing complex business interests, what you need to know about business valuation. Everything from empirical market evidence to credible expert business valuation testimony discussed and analyzed by the Hon. David Laro and Dr. Shannon Pratt.
Author : William M. Gentry
Publisher :
ISBN 13 :
Total Pages : 37 pages
Book Rating : 4.:/5 (248 download)
Download or read book Dividend Taxes and Share Prices written by William M. Gentry and published by . This book was released on 2001 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial economists have debated the impact of dividend taxes on firm valuation for decades, but existing empirical evidence is mixed. In this study, we avoid certain complications inherent in previous empirical work by exploiting institutional characteristics of Real Estate Investment Trusts (REITs). For REITs, dividend policy is largely non-discretionary, share repurchases are not tax advantaged relative to dividends, and the market value of a firm's assets is relatively transparent to investors. In addition, REITs are exempt from corporate taxes, so their tax deductions flow directly to shareholders as reductions in dividend taxes. Within this environment, we regress the market value of a REIT's equity on the market value of its assets and its tax basis in assets, which creates tax deductions that lower future dividend taxes. We find that tax basis has a positive effect on firm value, which suggests that investors capitalize future dividend taxes into share prices
Author : William M. Gentry
Publisher :
ISBN 13 :
Total Pages : 36 pages
Book Rating : 4.:/5 (129 download)
Download or read book Dividend Taxes and Share Prices written by William M. Gentry and published by . This book was released on 2011 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Dividend taxes have stimulated decades of debate regarding firm valuation and the cost of equity capital. However, existing evidence is mixed. In this study, we take a new approach to examine the share price effects of dividend taxes that exploits institutional characteristics of Real Estate Investment Trusts (REITs), avoiding some of the complications inherent in previous empirical work. For REITs, dividend policy is largely non-discretionary, share repurchases do not offer tax advantages relative to dividends, and the market value of a firm's assets is relatively transparent to investors. In addition, REITs are exempt from corporate taxes, so their tax deductions flow directly to shareholders as reductions in dividend taxes. Within this environment, we regress the market value of a REIT's equity on the market value of its assets and its tax basis in assets, which creates tax deductions that lower future dividend taxes. We find that tax basis has a positive effect on firm value, which suggests that investors capitalize future dividend taxes into share prices.
Author : James M. Poterba
Publisher :
ISBN 13 :
Total Pages : 102 pages
Book Rating : 4.0/5 ( download)
Download or read book The Economic Effects of Dividend Taxation written by James M. Poterba and published by . This book was released on 1984 with total page 102 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper tests several competing hypotheses about the economic effects of dividend taxation. It employs British data on security returns, dividend payout rates, and corporate investment, because unlike the United States, Britain has experienced several major dividend tax reforms in the last three decades. These tax changes provide an ideal natural experiment for analyzing the effects of dividend taxes. We compare three different views of how dividend taxes affect decisions by firms and their shareholders. We reject the"tax capitalization" view that dividend taxes are non-distortionary lump sum taxes on the owners of corporate capital. We also reject the hypothes is that firms pay dividends because marginal investors are effectively untaxed. We find that the traditional view that dividend taxes constitute a "double-tax" on corporate capital income is most consistent with our empirical evidence. Our results suggest that dividend taxes reduce corporate investment and exacerbate distortions in the intersectoral and intertemporal allocation of capital
Author : 郭南廷
Publisher :
ISBN 13 :
Total Pages : 88 pages
Book Rating : 4.:/5 (779 download)
Download or read book Individual-Shareholder-Level Dividend Taxes in Firm Valuation: New Evidence from Taiwan written by 郭南廷 and published by . This book was released on 2011 with total page 88 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Michelle Hanlon
Publisher :
ISBN 13 :
Total Pages : 50 pages
Book Rating : 4.:/5 (129 download)
Download or read book Dividend Taxes and Firm Valuation written by Michelle Hanlon and published by . This book was released on 2006 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent evidence and statements in Harris and Kemsley (1999) suggests that shareholder-level dividend taxes on retained earnings are fully impounded at the top statutory rate into stock prices. We re-examine these claims and results. Using the traditional definition of dividend tax capitalization, that asset prices will be lower if the asset returns are subject to higher taxation, we reject the claim that the valuation of retained earnings is reduced because it is subject to future taxes when distributed as dividends. Harris and Kemsley base their predictions and empirical tests on Ohlson (1995). We offer alternative formulations and interpretations of the role of contributed capital, retained earnings, and earnings in the Ohlson (1995) model. Our evidence does not reject dividend tax capitalization but does reject full dividend tax capitalization on retained earnings arising from future dividends being paid from the current stock of retained earnings. We also investigate the crucial role of the ratio of retained earnings to book value in Harris and Kemsley (1999) and report some results inconsistent with their interpretation of dividend taxes on retained earnings.
Author : James M. Poterba
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (874 download)
Download or read book Interpreting Ex-Dividend Evidence written by James M. Poterba and published by . This book was released on 1986 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Numerous empirical studies have attempted to measure the effect of changes in dividend policy on corporate equity values. One of the most popular study methodologies has been an examination of share price changes around ex-dividend days. Comparing the movement in a stock's price with its nominal dividend payment leads to estimates of the stock market's relative valuation of dividends and capital gains. Ex-day price studies are often interpreted as showing that investors recognize their tax liabilities and therefore discount their dividend income. These studies predict that firms which reduce their payout ratio shouldrise in value, and buttress the view that an increase in dividend taxes would reduce the value of the stock market.This study disputes these conclusions by presenting a "counterexample" which suggests that ex-dividend day studies provide limited insight into the effects of dividend taxes, or dividend policy, on corporate valuation. I analyze a firm with two different classes of common stock: one class pays taxable cash dividends, while the other pays untaxed stock dividends. On ex dividend days, the taxable-dividend shares experience a price decline equal to about seventy five percent of their dividend payment, while the untaxed stock distribution shares fall by the full value of their dividends. However, the prices of the two classes of equity do not reflect this apparent market preference for non-taxable distributions. The average price of taxable-dividend shares is approximately equal to that of the untaxed dividend shares, indicating that the market considers the two shares as equivalent. These findings are important for several reasons. First, they cast doubt on earlier conclusions, based on ex-dividend day studies, about how a change individend taxes or payout policy would affect the market value of equity capital. Second, the results may provide new insights which help to explain why firms pay dividends.They deny the view that investors hold dividend paying stocks only becau
Author : Oliver Zhen Li
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (129 download)
Download or read book Taxes and Valuation written by Oliver Zhen Li and published by . This book was released on 2007 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Under the US tax system, dividends are historically taxed at a higher rate than capital gains and thus incur a tax-related penalty. I provide evidence that the dividend tax penalty partially offsets the positive signaling and agency cost effects of dividends for fully taxable individual investors. The level of institutional ownership and the frequency of institutional trading, which proxy for the likelihood that the marginal investor is not a fully taxable individual, mitigate the negative dividend tax effect. My results support the notion that taxes impact equity valuation. I contribute to the literature by isolating dividends' negative tax effect from their positive signaling and agency cost effects.
Author : John R. Graham
Publisher : Now Publishers Inc
ISBN 13 : 1933019417
Total Pages : 136 pages
Book Rating : 4.9/5 (33 download)
Download or read book A Review of Taxes and Corporate Finance written by John R. Graham and published by Now Publishers Inc. This book was released on 2006 with total page 136 pages. Available in PDF, EPUB and Kindle. Book excerpt: A Review of Taxes and Corporate Finance investigates the consequences of taxation on corporate finance focusing on how taxes affect corporate policies and firm value. A common theme is that tax rules affect corporate incentives and decisions. A second emphasis is on research that describes how taxes affect costs and benefits. A Review of Taxes and Corporate Finance explores the multiple avenues for taxes to affect corporate decisions including capital structure decisions, organizational form and restructurings, payout policy, compensation policy, risk management, and the use of tax shelters. The author provides a theoretical framework, empirical predictions, and empirical evidence for each of these areas. Each section concludes with a discussion of unanswered questions and possible avenues for future research. A Review of Taxes and Corporate Finance is valuable reading for researchers and professionals in corporate finance, corporate governance, public finance and tax policy.
Author : Fraser Institute (Vancouver, B.C.)
Publisher : The Fraser Institute
ISBN 13 : 0889751897
Total Pages : 36 pages
Book Rating : 4.8/5 (897 download)
Download or read book International Evidence on the Effects of Having No Capital Gains Taxes written by Fraser Institute (Vancouver, B.C.) and published by The Fraser Institute. This book was released on 2001 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : James M. Poterba
Publisher :
ISBN 13 :
Total Pages : 10 pages
Book Rating : 4.:/5 (25 download)
Download or read book Taxation and Corporate Payout Policy written by James M. Poterba and published by . This book was released on 2004 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents new evidence on how corporate payout policy responds to the differential between the tax burden on dividend income and that on accruing capital gains. It describes the construction of weighted average marginal tax rate series for the period since 1929, and it suggests that the enactment of the Job Growth of Taxpayer Relief Reconciliation Act of 2003 should raise the after-tax value of dividends relative to capital gains by more than five percentage points. The impact of this change on payout depends on the elasticity of dividend payments with respect to the after-tax value of dividend income relative to capital gains. Time series estimates suggest an elasticity of more than three, and imply that the recent tax reform could ultimately increase dividends by almost twenty percent.
Author : James A. Ohlson
Publisher : North-Holland
ISBN 13 :
Total Pages : 208 pages
Book Rating : 4.F/5 ( download)
Download or read book The Theory of Financial Markets and Information written by James A. Ohlson and published by North-Holland. This book was released on 1987 with total page 208 pages. Available in PDF, EPUB and Kindle. Book excerpt:
