Determinants of corporate R&D expenditures: the role of taxes

2020 ◽  
Vol 7 (54) ◽  
pp. 110-126
Author(s):  
Dorota Wasiluk ◽  
Anna Białek-Jaworska
Keyword(s):  
Tax Rates ◽  
Cross Sectional ◽  
Effective Tax Rates ◽  
Tax Rate ◽  
Long Run ◽  
Internal Funds ◽  
The Difference ◽  
The Relationship ◽  
D Investment

AbstractThe paper aims to find the relationship between corporate expenditures on R&D and tax burdens comparing German with French R&D incentives. We use the OLS method for the financial and patent cross-sectional data retrieved from the Amadeus database. The results confirm that firms with higher tax spread (the difference between the nominal and effective tax rates) spend less on R&D. These are in line with findings of a positive relationship between corporate R&D investment and tax burdens. Thus, firms that invest in R&D more pay higher taxes. However, they are less profitable as the return on R&D investment is visible only in the long run. German corporate expenditures on R&D are significantly sensitive to internal funds (proxied by cash flow) and depend on debt, contrary to French. The results indicate that the French firm's age (a phase of life cycle) has a significant impact on spending on R&D compared to German. Whereas in both countries, corporate expenditures on R&D are sensitive to the number of obtained patents. The capability of reducing the level of tax burdens below the nominal tax rate in the case of older German firms stimulates them to increase their R&D expenditures. However, German firms can decrease tax due to the use of R&D grants (revenues without taxation) in the absence of other tax incentives related to R&D.

Long-Run Corporate Tax Avoidance

2008 ◽  
Vol 83 (1) ◽  
pp. 61-82 ◽  
Author(s):  
Scott D. Dyreng ◽  
Michelle Hanlon ◽  
Edward L. Maydew
Keyword(s):  
Tax Avoidance ◽  
Tax Rates ◽  
Corporate Tax ◽  
Effective Tax Rate ◽  
Initial Examination ◽  
Cross Sectional ◽  
Effective Tax Rates ◽  
Sample Mean ◽  
Tax Rate ◽  
Long Run

We develop and describe a new measure of long-run corporate tax avoidance that is based on the ability to pay a low amount of cash taxes per dollar of pre-tax earnings over long time periods. We label this measure the “long-run cash effective tax rate.” We use the long-run cash effective tax rate to examine (1) the extent to which some firms are able to avoid taxes over periods as long as ten years, and (2) how predictive one-year tax rates are for long-run tax avoidance. In our sample of 2,077 firms, we find there is considerable cross-sectional variation in tax avoidance. For example, approximately one-fourth of our sample firms are able to maintain long-run cash effective tax rates below 20 percent, compared to a sample mean tax rate of approximately 30 percent. We also find that annual cash effective tax rates are not very good predictors of long-run cash effective tax rates and, thus, are not accurate proxies for long-run tax avoidance. While there is some evidence of persistence in annual cash effective tax rates, the persistence is asymmetric. Low annual cash effective tax rates are more persistent than are high annual cash effective tax rates. An initial examination of characteristics of firms successful at keeping their cash effective tax rates low over long periods shows that they are well spread across industries but with some clustering.

Visualization of tax avoidance and tax rate convergence

2019 ◽  
Vol 27 (5) ◽  
pp. 695-724 ◽  
Author(s):  
Chika Saka ◽  
Tomoki Oshika ◽  
Masayuki Jimichi
Keyword(s):  
Tax Avoidance ◽  
Tax Rates ◽  
Cross Sectional ◽  
Effective Tax Rates ◽  
Accounting Data ◽  
Content Type ◽  
Tax Rate ◽  
Objective Evidence ◽  
New Perspective ◽  
Convergence Trend

Purpose This study aims to explore the evidence of the probability of firms’ tax avoidance and the downward convergence trend of national statutory tax rates and firms’ effective tax rates. Design/methodology/approach This research employs exploratory data analysis using interactive data manipulation and visualization tools, namely, R with SparkR, dplyr, ggplot2 and googleVis (GeoChart and Motion Chart) packages. This analysis is based on the world-scale accounting data of all listed firms from 148 countries spanning 30 years. Findings The results reveal the following: three types of evidences on probability of firms’ tax avoidance, showing a non-random distribution of firms’ effective tax rates and return on assets, cross-sectional variation of firms’ effective tax rates in each country, and the trend of difference between effective tax rates and statutory tax rates, and the downward convergence trend of statutory tax rates and firms’ effective tax rates. Practical implications The results highlight the prominent issues of world-scale tax avoidance and tax rate competition and facilitate a collaborative discussion between laymen and professionals using objective evidence. Originality/value A novel methodology is adopted through the visualization of world-scale accounting data, which can facilitate a new perspective, revealing unexpected patterns and trends in otherwise hidden information. This study also highlights the importance of global consideration of firms’ tax avoidance and tax rate competition, using objective evidence.

scholarly journals Relationship between rs3918242 Polymorphism of Matrix Methaloproteinase-9 Gene and Preeclampsia in Pregnant Women

2020 ◽  
Vol 24 (5) ◽  
pp. 434-443
Author(s):  
Mehdi Sahmani ◽  
◽  
Nilofar Ahmadi ◽  
Somayeh Asadian ◽  
Talaat Dabaghi Ghaleh ◽  
...  
Keyword(s):  
Pregnant Women ◽  
Cross Sectional Study ◽  
Unknown Etiology ◽  
Cross Sectional ◽  
Complex Disorder ◽  
The Difference ◽  
Study Participants ◽  
The Relationship ◽  
Mmp9 Gene

Background: Preeclampsia is a complex disorder of pregnancy with an unknown etiology. Numerous studies have shown the possible role of gene polymorphisms, especially metalloproteinases, in development of this disease, but there are no definitive results. Objective: This study aims to investigate the possible association between rs3918242 (−1562C>T) polymorphism in Matrix Metalloproteinase 9 (MMP9) gene with the risk of preeclampsia in pregnant women. Methods: In this cross-sectional study, participants were 90 pregnant women with preeclampsia and 199 healthy pregnant women (controls). The genotypes of rs3918242 polymorphism were investigated using Polymerase Chain Reaction technique and Limited Fragment Length Polymorphism method. Logistic regression analysis was used to investigate the relationship between rs3918242 polymorphism and preeclampsia. Findings: The frequency of CC, CT, TT genotypes of rs3918242 polymorphism was reported 47.8%, 47.8% and 4.2% in patients and 84.8, 13.1 and 2% in controls, respectively, and the difference between groups was significant (P<0.001). The frequency of TT genotype in patients was significantly higher than in controls (P<0.001). Moreover, the frequency of T allele in patients was 52.2%, while in controls it was 15.2% and the difference between the two groups was significant (P<0.001). Conclusion: The rs3918242 polymorphism of MMP9 gene plays an important role in the incidence of preeclampsia in pregnant women.

The Political Economy of Taxation: Some Evidence for Canada

1988 ◽  
Vol 16 (3) ◽  
pp. 315-329 ◽  
Author(s):  
André Blais ◽  
François Vaillancourt
Keyword(s):  
Manufacturing Industry ◽  
Tax Avoidance ◽  
Tax Rates ◽  
Corporate Tax ◽  
Effective Tax Rates ◽  
Tax Rate ◽  
Independent Variables ◽  
Methodological Problems ◽  
Canadian Manufacturing ◽  
The Relationship

The article examines the determinants of variations in the effective average tax rate among Canadian manufacturing industry. It replicates a previous study (Salomon and Siegfried, 1977) on the U.S. corporate tax that found relationships between the economic structure and tax avoidance rates. Some methodological problems in the study are identified, which raise doubts about their conclusions. It is shown that effective tax rates fluctuate substantially over time and that the results may be sensitive to the year selected for analysis. As a consequence, tax-avoidance rates are regressed against a number of independent variables in two different years: 1974 and 1979. The overall weakness of the relationship is striking. With our best measure of the tax-avoidance rate, 2 out of 12 variables are significant in 1974 and one in 1979. These findings suggests that the corporate income tax may not be as important an instrument of industrial policy as it is sometimes claimed to be.

The role of sustainability practices in international port operations

2017 ◽  
Vol 21 (2) ◽  
pp. 125-144 ◽  
Author(s):  
Sihyun Kim ◽  
Bong Gyu Chiang
Keyword(s):  
Attitude Change ◽  
Cross Sectional ◽  
Content Type ◽  
Port Operations ◽  
Longitudinal Approach ◽  
The Difference ◽  
And Performance ◽  
The Relationship ◽  
Practical Implications

Purpose With increasing attention to sustainability in port operations, the purpose of this paper is to analyze the role of sustainability practice (SP) as a moderator on the relationships between competitiveness and performance in port operations. Design/methodology/approach To explore the specific route of SPs in managing competitiveness and performance, this study adopted the hierarchical moderated regression analysis. Additionally, to analyze the difference in the level of implementation of SP, alternative subgroup analysis was conducted via independent sample t-tests in SPSS 21. Findings Research results have shown the role of SPs in achieving outstanding port activities, which significantly moderates the relationship between competitiveness, particularly for operational efficiency and service quality, and performance. Research limitations/implications As this study is based on cross-sectional data, it does not tap any temporal attitude change, which would require a longitudinal approach. The authors contribute to filling a void between what is achievable and how sustainable practice contributes to managing competitiveness and performance, based on commercial port operations. Practical implications Results provide useful insights to establish the strategies to develop sustainable port operations and a strategic agenda to assist ports to incorporate SP. Originality/value Drawing on multiple theories, this study advances the role of SP by shedding new light on how it improves operational sustainability through strengthening the relationships between competitiveness and performance.

Higher Taxes at the Top: The Role of Entrepreneurs

2021 ◽  
Vol 13 (3) ◽  
pp. 1-36
Author(s):  
Bettina Brüggemann
Keyword(s):  
Income Distribution ◽  
Income Tax ◽  
Tax Rates ◽  
Welfare Gains ◽  
Marginal Tax Rate ◽  
Tax Rate ◽  
Long Run ◽  
Marginal Tax Rates

This paper computes optimal top marginal tax rates in Bewley-Huggett-Aiyagari–type economies that include entrepreneurs. Consistent with the data, entrepreneurs are overrepresented at the top of the income distribution and are thus disproportionately affected by an increase in the top marginal income tax rate. The top marginal tax rate that maximizes welfare is 60 percent. While average welfare gains are positive and similar across occupations along the transition, they are larger for entrepreneurs than for workers in the long run, and this occupational gap in welfare gains after the tax increase widens with increasing income. (JEL D11, D21, D31, H21, H24, L26)

The Relationship Between Effective Tax Rate and Firm Size

2020 ◽  
Vol 7 (2) ◽  
pp. 37-61
Author(s):  
Epameinondas Katsikas ◽  
Dimitrios Koufopoulos ◽  
Jacob Lewis
Keyword(s):  
Firm Size ◽  
Retail Trade ◽  
Research Approach ◽  
Tax Rates ◽  
Effective Tax Rate ◽  
Effective Tax Rates ◽  
Tax Rate ◽  
Factors Affecting ◽  
Trade Sector ◽  
The Relationship

The current research studies firm size and other determinants of effective tax rates for UK companies operating in the wholesale and retail trade sector. A panel of 784 companies from the BvD Company Independence Indicator (BvD's FAME database) is studied over the six-year period 2008-2013. The research approach is unique in terms of the comprehensive data it is using as it is large panel data and it involves finance and accounting analytics. The analysis shows that size and profitability were significant factors affecting the average effective tax rates of companies in the wholesale and retail trade sector.

One Hit Makes the Difference: The Role of Polyvictimization in Childhood in Lifetime Revictimization on a Southern European Sample

2014 ◽  
Vol 29 (2) ◽  
pp. 217-231 ◽  
Author(s):  
Noemí Pereda ◽  
David Gallardo-Pujol
Keyword(s):  
Cumulative Effect ◽  
Childhood Victimization ◽  
Cross Sectional ◽  
Retrospective Design ◽  
Traumatic Life Events ◽  
Child Victimization ◽  
Interpersonal Victimization ◽  
The Difference ◽  
The Relationship

Objective: To present statistics documenting the scope and the nature of child victimization, polyvictimization, and revictimization and to explore the relationship between victimization in childhood and later revictimization in adulthood. Methods: The sample comprises 975 undergraduates in a cross-sectional, retrospective design. Childhood victimization and lifetime revictimization were assessed using the Traumatic Life Events Questionnaire. Results: 26.59% of participants reported childhood interpersonal victimization and 16.80% reported an interpersonal victimization episode in adulthood. Polyvictimization was reported by 8.30%, whereas 7.50% of the sample suffered child victimization and adult revictimization. Multiple regression showed that child polyvictimization significantly predicted adult revictimization. Conclusions: The results support the idea that polyvictimization in childhood exerts a cumulative effect on interpersonal victimization in adulthood. More importantly, polyvictimization is a key concept to understanding the risk of revictimization, even at low rates.

The Problem of Identifying and Modeling the Relationship between Monetary Factor and Inflation in the Russian Economy

2008 ◽  
pp. 61-76
Author(s):  
A. Porshakov ◽  
A. Ponomarenko
Keyword(s):  
Money Supply ◽  
Money Demand ◽  
Russian Economy ◽  
Long Run ◽  
Complex Approach ◽  
Wide Range ◽  
Long Time ◽  
The Relationship ◽  
Supply Side Factors

The role of monetary factor in generating inflationary processes in Russia has stimulated various debates in social and scientific circles for a relatively long time. The authors show that identification of the specificity of relationship between money and inflation requires a complex approach based on statistical modeling and involving a wide range of indicators relevant for the price changes in the economy. As a result a model of inflation for Russia implying the decomposition of inflation dynamics into demand-side and supply-side factors is suggested. The main conclusion drawn is that during the recent years the volume of inflationary pressures in the Russian economy has been determined by the deviation of money supply from money demand, rather than by money supply alone. At the same time, monetary factor has a long-run spread over time impact on inflation.

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