@techreport{Arachi2010Taxes,
abstract = {This paper provides further empirical evidence on the relationship between taxes and financial reporting by focusing on accounting decisions to write-offs equity investments. The analysis is based on panel data for Italian companies. In the period 1998-2006 the Italian corporate income tax has been reformed several times. In particular the tax deductibility of write-offs of equity investment was repealed in 2004. The paper exploits the ensuing high cross-sectional and times series variation in the marginal tax rate to identify tax effects. The econometric analysis delivers strong evidence that taxes affect the probability of write-offs. In contrast there is no evidence that taxes affect the magnitude of the write-offs. The paper also tests for the existence of a trade-off between tax minimization and non tax costs such as financial reporting costs and agency costs. Surprisingly, the evidence of such trade-off is rather weak.},
address = {M\"{u}nchen},
author = {Giampaolo Arachi and Valeria Bucci},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {H25; H32; K34; M41; 330; corporate taxation; write-offs of equity investments; financial reporting; tax planning; K\"{o}rperschaftsteuer; Steuerbeg\"{u}nstigung; Kapitalbeteiligung; Steuerwirkung; Bilanzpolitik; Steuerplanung; Italien},
language = {eng},
number = {3261},
publisher = {CESifo},
title = {Taxes and financial reporting: Evidence from discretionary investment write-offs in Italy},
type = {CESifo working paper: Public Finance},
url = {http://hdl.handle.net/10419/46539},
year = {2010}
}
