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Title:Effects of corporate tax reforms on SMEs' investment decisions under the particular consideration of inflation PDF Logo
Authors:Nam, Chang Woon
Radulescu, Doina Maria
Issue Date:2005
Series/Report no.:CESifo working papers 1478
Abstract:Corporate tax reforms carried out in EU countries since 1980 entail lower statutory tax rates and reductions in generous tax depreciation provisions. Several countries including the UK have reduced tax rates for SMEs. This study compares incentive effects of such reforms on the SMEs? investment decisions adopting simple present value model. Ceteris paribus tax rate and depreciation rule vary in the model simulation, while the application of historical cost accounting method in inflationary phases leads to fictitious increases in nominal net present value. Apart from the construction of international ranking, country- specific patterns of reform effects are also illustrated.
Subjects:SMEs
corporate tax reform
investment decision
inflation
EU countries
JEL:H25
H32
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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