Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/83124
Authors: 
Lindhe, Tobias
Södersten, Jan
Year of Publication: 
2013
Series/Report no.: 
Working Paper, Department of Economics, Uppsala University 2013:16
Abstract: 
This paper examines how the distortions caused by dividend taxation depend on whether or not shareholders can recover their original equity injections without being subject to the dividend tax. We point out the alternative assumptions in the literature on this, and we compare two different tax regimes, one where it is impossible for the firm to pay cash to its shareholders that is not taxed as dividends, the other where the shareholders are allowed a tax-free return of the original capital contributed through new issues. Our analysis shows that the regimes imply a substantial difference to our perceptions of the distortive effects of dividend taxation.
Subjects: 
Self-employment
dividend taxation
share repurchases
equity trap
cost of capital
nucleus theory
growth path
JEL: 
H24
H25
H32
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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