19公司税.ppt

CHAPTER 19 THE CORPORATION TAX Corporations Corporation – A state-chartered form of business organization, usually with limited liability for shareholders (owners) and an independent legal status Limited liability Corporations are “artificial legal persons” Why Tax Corporations? Only real people can pay a tax Justifications Corporations are distinct entities Corporations receive special privileges from society Protects integrity of personal income tax Structure Treatment of Dividends versus Retained Earnings Double taxation Effective Tax Rate on Corporate Capital Statutory rate versus effective rate Interest deductibility Depreciation allowances Inflation Double taxation Gravelle [2004] Effective corporate rate = 32%; noncorporate rate = 18% Sensitivity of estimate Incidence and Excess Burden A tax on corporate capital Incidence in a general equilibrium model Excess burden on a general equilibrium model A tax on economic profits Incidence and excess burden of a tax on economic profits Actual corporate profits versus economic profits Stiglitz [1973] model Effects on Behavior – Total Physical Investment Accelerator Model Neoclassical Model Cash Flow Model Effects on Behavior-Type of Asset Tax system encourages purchase of assets that receive relatively generous depreciation allowances Effects on Behavior-Corporate Finance Why do firms pay dividends? Dividends as a signal of firm’s financial strength Clientele effect Effect of taxes on dividend policy Empirical evidence – Chetty and Saez [2004] Effect on savings Debt versus Equity Finance Did the tax system cause the corporate accounting scandals? State Corporation Taxes State taxes have similar incidence and efficiency problems as federal taxes Variation of tax rates across state lines Taxation of Multinational Corporations Structure U. S. corporations pay tax at standard rate on global taxable income Credit for foreign taxes paid Subsidiary status Deferral of taxes on income from foreign enterprise Repatriation I