Corporate taxes have a significant influence on the balance sheet ...

De Socio, Antonio and Nigro, Valentina, Does Corporate Taxation Affect Cross-Country Firm Leverage? (November 29, 2012). Bank of Italy Temi di Discussione (Working Paper) No. 889. Available at SSRN: http://ssrn.com/abstract=2206357

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: Firm Leverage, Leverage, Corporate Taxes, Capital Structure

Source: http://www.marketobservation.com/blogs/index.php/2013/01/30/corporate-taxes-have-a-significant-influence-on-the-balance-sheet-structure-of-firms?blog=8

st patrick s day parade duke invisible children garbage pail kids st bonaventure ncaa tournament 2012 peyton manning 49ers