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on Accounting and Auditing |
| By: | M.P. Lycklama a Nijeholt; Y.K. Grift; J.M.J. Blommaert |
| Abstract: | This study examines whether the introduction of SFAS 141 "Business Combinations" (2001) and SFAS 142 "Goodwill and other Intangible Assets" (2001) has led to more precise information about accounting goodwill in the financial statements of acquirers. Acquisitions in the period 1997-2005 between US stock exchange listed companies were studied. The results show that after the introduction of new regulation the relative amount of accounting goodwill (59,8% of the purchase price) is lower when compared to relative accounting goodwill in the period before (67,6% of the purchase price). Moreover, more acquiring companies reported on intangibles under the new regime. Correcting for industries of the target companies, the total combined effect of the new accounting regime and reporting on intangible assets on relative goodwill is significant and negative. However, the effect of the new regime is limited for companies that separately report on acquired intangible assets. Apparently, this type of company is already accurately reporting. The results indicate that the changes in regulation have made goodwill a more concise concept; thereby bringing accounting goodwill and economic goodwill closer together. |
| Keywords: | Goodwill, Mergers and Acquisitions, SFAS 141, SFAS 142, Value Creation |
| JEL: | G34 M41 M48 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:1222&r=acc |
| By: | M.P. Lycklama a Nijeholt; Y.K. Grift; J.M.J. Blommaert |
| Abstract: | The reason for this research is that at the beginning of the 21st century, some important changes were introduced in the international standards of accounting affecting reporting on goodwill. The intentions of the standard-setting bodies in drafting the new rules were that the financial statements would better reflect the underlying economics of the acquired goodwill.1 In this research it is tested whether goodwill under the new accounting regime does reflect underlying economics and therefore provides information on expected value creation of the acquisition. The results of the research show that goodwill contains elements of value creation: characteristics of valuecreating acquisitions have a positive effect on purchased goodwill. However, also other characteristics determine the amount of purchased goodwill. |
| Keywords: | Goodwill, Mergers and Acquisitions, SFAS 141, SFAS 142, Value Creation |
| JEL: | G34 M41 M48 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:1221&r=acc |
| By: | Francesco Figari (University of Insubria); Paulus, A. (Alari) |
| Abstract: | This paper examines the redistributive impact of imputed rent (private and public) and indirect taxes (value added tax and excises), comparing this with the effects of cash transfers and direct taxes in five EU countries. The extended income concept, taking into account both imputed rent and indirect taxes, provides a more reliable picture of inequality differences across countries. Our results show that indirect taxes have a regressive effect with respect to income in all countries considered but always smaller in magnitude than other tax-benefit instruments. Imputed rent reduces overall inequality in particular where the prevalence of individuals living in own accommodation is high even among the poorest (Greece) and where the contribution of the public imputed rent is large (the UK). |
| Keywords: | Imputed rent, indirect taxes, European Union, household income, microsimulation, EUROMOD. JEL: C81, H23, D63 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:aia:ginidp:28&r=acc |
| By: | Luca Gandullia; Nicola Iacobone; Alastair Thomas |
| Abstract: | This paper examines the taxation of labour income in five key emerging economies: Brazil, China, India, Indonesia and South Africa (the “BIICS” countries). The paper highlights the key features of the taxation of labour income in these countries, and then uses this information to model the tax burdens on labour income in each country following the OECD's Taxing Wages methodology. Average and marginal tax wedges in Brazil and China (Shanghai) are found to be similar in size in 2010 to those of many OECD countries. In contrast, India, Indonesia and South Africa (as well as rural China) impose very low average and marginal tax wedges compared to the vast majority of OECD countries. These relatively low tax wedge results are not altogether surprising given that these countries also currently have lower tax-to-GDP ratios than the OECD average. However, the results suggest that, in the long-term, reforms will be necessary in most of the BIICS countries if the labour income base is to significantly contribute to funding the substantial increases in public expenditure, particularly on infrastructure and social insurance, that will inevitably come as these countries continue to grow.<P>Modéliser la charge fiscale pesant sur les revenus du travail en Afrique du Sud, au Brésil, en Chine, en Inde et en Indonésie<BR>Ce document propose un examen de la taxation des revenus du travail dans cinq grandes économies émergentes, à savoir l’Afrique du Sud, le Brésil, la Chine, l’Inde et l’Indonésie. Il met l’accent sur les principales caractéristiques des régimes d’imposition en vigueur dans ces pays, les informations correspondantes étant ensuite utilisées pour modéliser la charge fiscale pesant sur les revenus du travail dans chaque pays à l’aide de la même méthodologie que celle suivie par l’OCDE pour sa publication intitulée Les impôts sur les salaires. Il apparaît qu’au Brésil et en Chine (Shanghai), les coins fiscaux moyens et marginaux sont du même ordre que ceux d’un grand nombre de pays de l’OCDE en 2010. En Afrique du Sud, en Inde et en Indonésie (ainsi qu’en Chine rurale) en revanche, les coins fiscaux moyens et marginaux sont très faibles en comparaison de ceux de la grande majorité des pays de l’OCDE. Le niveau relativement bas de ces chiffres n’est pas vraiment surprenant étant donné que ces pays affichent actuellement des rapports impôt/PIB inférieurs à la moyenne de l’OCDE. Il donne cependant à penser que, sur le long terme, des réformes seront nécessaires dans la plupart de ces économies si la taxation des revenus du travail doit apporter une contribution notable au financement des hausses considérables des dépenses publiques, en particulier dans les domaines des infrastructures et de la sécurité sociale, qu’elles devront inévitablement assumer à mesure qu’elles continueront à croître. |
| Keywords: | personal income tax, tax wedge, social security contributions, labour income, coin fiscal, cotisations de sécurité sociale, revenus du travail, impôt sur le revenu des personnes physiques |
| JEL: | H24 H55 |
| Date: | 2012–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ctpaaa:14-en&r=acc |
| By: | Langenmayr, Dominika; Haufler, Andreas; Bauer, Christian J. |
| Abstract: | Heterogeneous firm productivity seems to provide an argument for governments to pursue 'pick-the-winner' strategies by subsidizing highly productive firms more, or taxing them less, than their less productive counterparts. We appraise this argument by studying the optimal choice of effective tax rates in an oligopolistic industry with heterogeneous firms. We show that the optimal structure of tax differentiation depends critically on the feasible level of corporate profit taxes, which in turn depends on the degree of international tax competition. When tax competition is moderate and profit taxes are high, favoring high-productivity firms is indeed the optimal policy. When tax competition is aggressive and profit taxes are low, however, the optimal tax policy is reversed and low-productivity firms are tax-favored. |
| Keywords: | business taxation; firm heterogeneity; tax competition |
| JEL: | H25 H87 F15 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:14277&r=acc |
| By: | Hemmerich, Kristina; Kiesewetter, Dirk |
| Abstract: | Der Beitrag leitet ein Konzept entscheidungsneutraler und gleichmäßiger Gewinnbesteuerung her, das selbst bei unvollkommener Voraussicht praktikabel, rechtssicher und mit einer Gewinnermittlung durch nominalen Vermögensvergleich vereinbar ist. Wir zeigen, dass ein Verfahren revolvierender Ertragswertkorrektur in Anlehnung an König (1997 a) bei zusätzlicher Erfassung des Kapitalwertes diese Anforderungen erfüllt. Das rechnerisch komplexe Vorgehen kommt mit geringfügigen Vereinfachungen der Gewinnermittlung durch Vermögensvergleich nach geltendem Steuerrecht im Ergebnis sehr nahe. Auch das theoretisch bislang ungelöste Problem des zeitlichen Bezugspunktes der Einkommensbesteuerung wird dann vernachlässigbar. -- The paper aims at designing a concept of neutral and equitable profit taxation which is legally reliable under imperfect foresight and which is compatible with basic principles of tax accounting, in particular with the historical cost convention. We show that this can be realized through revolving corrections of the Johansson-Samuelson tax base as first described by König (1997 a) combined with a taxation of the net present value. The procedure is technically complex but can be simplified considerably at the cost of reduced accuracy. In this form it is almost equal to nominal accrual tax accounting as established in Germany and other countries. This simplification also solves the problem of defining the correct point of reference (t = 0) in the Johansson-Samuelson concept. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:arqudp:139&r=acc |
| By: | Antonio De Socio (Bank of Italy); Valentina Nigro (Bank of Italy) |
| Abstract: | We evaluate the relation between firm leverage and taxation of corporate income using a dataset of mostly unlisted European corporations, highly representative of medium-sized and large firms. We use a correlated random effect approach in order to take into account unobserved heterogeneity and to assess the contribution of cross-sectional variation of the regressors. We also apply quantile regressions to evaluate a possible differential impact of taxation on leverage across firms. Our results suggest that corporate income taxation is positively related to leverage and explains part of the cross-country variability, showing a stronger effect for less levered firms. In accordance with the theory of the debt tax shield, the relation between debt and taxation is stronger for highly profitable firms. These findings are robust to the inclusion of different measures of the financial development and characteristics of the legal system of the country where firms are located. |
| Keywords: | leverage, corporate taxation, financial structure |
| JEL: | G32 H32 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_889_12&r=acc |
| By: | Piketty, Thomas; Saez, Emmanuel |
| Abstract: | This paper derives optimal inheritance tax formulas that (a) capture the key equity-efficiency trade-off, (b) are expressed in terms of estimable sucient statistics, (c) are robust to the underlying structure of preferences. We consider dynamic stochastic models with general and heterogeneous bequest tastes and labor productivities. We limit ourselves to simple but realistic linear or two-bracket tax structures to obtain tractable formulas. We show that long-run optimal inheritance tax rates can always be expressed in terms of distributional parameters, aggregate behavioral elasticities and social preferences for redistribution. Importantly, those results carry over with tractable modifications to (a)the case with social discounting (instead of steady-state welfare maximization), (b) the case with partly accidental bequests, (c) the standard Barro-Becker dynastic model. In all cases, the optimal inheritance tax rate increases with the concentration of bequest received and decreases with the elasticity of aggregate bequests to the net-of-tax rate. The optimal tax rate is positive and quantitatively large if concentration is high, the elasticity is low and society cares mostly about those receiving little inheritance. In contrast, the optimal tax rate is negative when society cares mostly about inheritors. We propose a calibration using micro-data for France and the United States. We find that for realistic parameters the optimal inheritance tax rate might be as large as 50%-60% - or even higher for top bequests, in line with historical experience. |
| Keywords: | Inheritance; Optimal taxation; Wealth |
| JEL: | H10 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:9241&r=acc |
| By: | Isabel Busom Piquer (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona); Beatriz Corchuelo (Deparment of Economy, University of Extremadura); Ester Martinez Ros (Departamento de Economía de la Empresa, Universidad Carlos III de Madrid and UNU-MERIT) |
| Abstract: | This paper studies whether firms’ use of R&D subsidies and R&D tax incentives is correlated to two sources of underinvestment in R&D, financing constraints and appropriability. We find that financially constrained SMEs are less likely to use R&D tax credits and more likely to obtain subsidies. SMEs using legal methods to protect their intellectual property are more likely to use tax incentives. Results are ambiguous for large firms. For both having previous experience in R&D increases the likelihood of using tax incentives, while it reduces the likelihood of using exclusively subsidies, suggesting that the latter induce entry into R&D. Results imply that direct funding and tax credits do not have the same ability to address each source of R&D underinvestment, and that on average subsidies may be better suited than tax credits at least for SMEs. From a policy perspective these tools may be complements rather than substitutes. |
| Keywords: | R&D, tax incentives, subsidies, policy mix |
| JEL: | H25 L60 O31 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea1212&r=acc |