Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/157758
Authors: 
Fossen, Frank M.
Simmler, Martin
Year of Publication: 
2016
Citation: 
[Journal:] International Tax and Public Finance [Volume:] 23 [Issue:] 1 [Pages:] 48-81 [ISSN:] 1573-6970
Abstract: 
Tax competition for capital has led to a trend where many countries levy lower taxes on interest income, often introducing differential taxation between interest and business income. This study analyzes the effect on firm debt usage. We exploit Germany's 2009 tax reform, which introduced a final withholding tax on interest income with a flat rate 18 percentage points below the unchanged tax rate on income from unincorporated businesses, as a quasi-experiment. The results, based on firm-level panel data, indicate that firms increase their leverage when the tax rate on interest income decreases, albeit to a small degree.
Subjects: 
Income taxation
Capital taxation
Financial structure
Leverage
Matching
JEL: 
H25
H24
G32
Persistent Identifier of the first edition: 
Document Type: 
Article

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.