Do Taxes Affect Corporate Decisions? A Review
This chapter reviews tax research related to whether corporate and personal taxes affect domestic and multinational capital structure, debt maturity, payout policy, compensation policy, risk management, earnings management, leasing, pensions, R&D partnerships, tax shelters, transfer pricing, repatriation of foreign profits, and organizational form. For each topic, theory related to how taxes can affect corporate decision making and firm value is reviewed, followed by a summary of the related empirical evidence and a discussion of unresolved issues. Tax research generally supports the ...