Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/26501 
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dc.contributor.authorWeichenrieder, Alfons J.en
dc.contributor.authorWindischbauer, Helenen
dc.date.accessioned2009-01-12-
dc.date.accessioned2009-07-28T08:47:35Z-
dc.date.available2009-07-28T08:47:35Z-
dc.date.issued2008-
dc.identifier.urihttp://hdl.handle.net/10419/26501-
dc.description.abstractBy granting intracompany loans to their foreign affiliates, multinational firms may reduce their tax liability abroad. Many countries have legislated thin-capitalization rules (TCRs) that limit the allowable levels of intracompany loans or restrict interest deductibility if certain thresholds are crossed. This paper empirically analyzes the effect of the German TCR on corporate policy. We find that tightening the regulations in 2001 had some limiting effect on leverage. Foreign affiliates reacted by reducing intracompany loans and increasing equity, with no significant evidence of reduced real investment. A possible reason for the limited impact of the TCR was that multinational firms had the option to work around the regulation by using holding company structures. Indeed, holding companies have been used to shift huge amounts of intracompany loans onto the books of German affiliates. At the same time, however, only part of these observed reorganizations seem to have been a reaction to TCR.en
dc.language.isoengen
dc.publisher|aCenter for Economic Studies and ifo Institute (CESifo) |cMunichen
dc.relation.ispartofseries|aCESifo Working Paper |x2456en
dc.subject.jelH25en
dc.subject.jelG38en
dc.subject.ddc330en
dc.subject.keywordMultinational firmen
dc.subject.keyworddebten
dc.subject.keywordthin capitalizationen
dc.subject.keywordfinancial structureen
dc.subject.stwKapitalstrukturen
dc.subject.stwKörperschaftsteuerrechten
dc.subject.stwMultinationales Unternehmenen
dc.subject.stwGewinnverlagerungen
dc.subject.stwDeutschlanden
dc.titleThin-capitalization rules and company responses experience from German legislation-
dc.typeWorking Paperen
dc.identifier.ppn589227882en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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