The Effect of Tax Convexity on Corporate Investment Decisions and Tax Burdens

This paper examines the effect of convexity in the corporate tax schedule on corporate investment decisions and tax burdens. Using a contingent‐claims model, we show that greater tax convexity results in (i) earlier exit, (ii) delayed investment (except for small entry cost), and (iii) reduced corporate risk taking (except for small entry cost and unfavorable operating conditions). Also, the effective tax burden is an increasing function of tax convexity. The convexity of the tax schedule has a nontrivial impact on corporate investment decisions and investment levels. These results are relevant for economic growth, which depends (at least partly) on investment levels, and tax policy makers should be aware of these effects when making adjustments that might impact the convexity of the corporate tax schedule.     

Progressive Taxation, Tax Exemption, and Irreversible Investment under Uncertainty

We analyze the impact of progressive taxation on irreversible investment under uncertainty. We show that if tax exemption is lower than sunk cost, higher tax rate will decelerate optimal investment by increasing the optimal investment threshold, while if tax exemption exceeds sunk cost, three different regimes arise. For “small” volatilities the optimal investment threshold is a positive function of volatility, but independent of tax rate. For “medium” volatilities it is independent of both tax rate and volatility. Finally, for “high” volatilities the optimal investment threshold depends positively on volatility, but negatively on tax rate so that we have “tax paradox”.     

Tax Policy and Human Capital Formation with Public Investment in Education

This paper studies the effects of distortionary taxes and public investment in an endogenous growth OLG model with knowledge transmission. Fiscal policy affects growth in two respects: first, work time reacts to variations of prospective tax rates and modifies knowledge formation; second, public spending enhances labour efficiency but also stimulates physical capital through increased savings. It is shown that Ramsey-optimal policies reduce savings due to high tax rates on young generations, and are not necessarily growth-improving with respect to a pure private system. Non-Ramsey policies that shift the burden on adults are always growth-improving due to crowding-in effects: the welfare of all generations is unambiguously higher with respect to a private system, and there generally exists a continuum of non-optimal tax rates under which long-run growth and welfare are higher than with the Ramsey-optimal policy.     

Pollution Abatement Investment When Environmental Regulation Is Uncertain

In a dynamic model of a risk-neutral competitive firm that can lower its pollution emissions per unit of output by building up abatement capital stock, we examine the effect of a higher pollution tax rate on abatement investment both under full certainty and when the timing or the size of the tax increase is uncertain. We show that a higher pollution tax encourages abatement investment if it does not exceed a certain threshold rate. However, akin to the Diamond-Mirrlees tax anomaly, it is possible that a higher pollution tax rate results in more pollution. The magnitude uncertainty discourages abatement investment, but at the time of the actual tax increase the abatement investment path may shift either upward or downward. On the other hand, when the timing is uncertain, the abatement investment path always jumps upward, thus suggesting that the effect of magnitude uncertainty on the optimal investment path may be more pronounced than that of timing uncertainty. Further, we show that the ad hoc practice of raising the discount rate to account for the uncertainty leads to underinvestment in abatement capital. We show how the size of this underinvestment bias varies with the future tax increase. Finally, we show that a credible threat to accelerate the tax increase can induce more abatement investment.     

Credibility, Irreversibility of Investment, and Liberalization Reforms in LDCs

Empirical evidence of the impact of policy uncertainty on aggregate investment is mixed. However, if the relationship between policy uncertainty and investment performance is nonlinear, linear regression exercises might not capture the effect of policy uncertainty. In this paper, I present a simple model with investment irreversibility which shows that, in the presence of legal constraints on investment in foreign assets, domestic real investment performance is poorer when liberalization reforms are only partially incredible .     

Corporate Investment and Tax Disincentive: Evidence from China

This study investigates how taxes influence corporate investment behavior. Based on a census of Chinese industrial enterprises, we utilize a tax-adjusted q model to examine the effects of taxes on corporate investment in fixed assets in China. Results show that the effective tax rate has a relatively small but significantly negative impact on Chinese firms’ investment in fixed assets. We extend the tax-adjusted q model to control for the lagged investment effect and peer effect of investment. Models with these effects do better at explaining the impact of taxes on firms’ investment. The lagged investment models present smaller but significant tax disincentive. Firms compete for investment with other firms both in the same region and in the same industry through peer effect. In addition, the tax disincentive differs among state owned enterprises, private enterprises, and other enterprises in China.     

基于可计算的一般均衡模型的我国碳税政策“双重红利”研究

建立了分析我国减少二氧化碳排放而征收碳税的可计算的一般均衡模型,分析碳税政策的双重红利。结果显示:为减少二氧化碳排放而征收碳税,对社会经济变量将造成一定的负面影响。保持财政中性,在征收碳税的时候,减少居民或者企业间接税,都可以在减少二氧化碳排放量的同时提高社会福利或者保持社会福利变化不大,实现碳税的双重红利。但是在保持财政中性,在征收碳税的同时减少企业所得税,虽然减少了二氧化碳排放量,居民的社会福利却有了更大程度的下降。     

Investment under Trade Policy Uncertainty: an Empirical Investigation*

The link between trade policy uncertainty and the share of investment in GDP per capita is investigated using panel data drawn from over a hundred countries for the period 1960–2000. Five indicators of trade policy are used. Two specifications of volatility for each of the trade policy indicators are constructed as measures of trade policy uncertainty. Panel regression results suggest a robust correlation between the volatility of trade policy indicators and the investment share. A significant negative impact of trade policy volatility on the investment share is found in most trade policy indicators with an exception—the volatility of the trade share indicator more closely associated with volatility in quantity than in prices has a significant positive impact on the investment share.     

纳税信用评级结果披露与研发投入

以纳税信用评级披露作为一个天然外生冲击,并基于2013—2016年1214家A股上市公司的微观数据构造准自然实验,使用双重差分法系统评估纳税信用评级结果披露对上市公司研发投入的影响。结果发现:纳税信用评级结果披露显著增加了上市公司的研发投入。基于PSM-DID方法的估计结果与上述结论无明显差异。稳健性检验也表明上述结论的正确性。机制检验表明,纳税信用评级结果披露通过降低企业的融资约束,进而促进企业增加研发投入。此外,分样本回归发现纳税信用评级结果披露只能对中小型企业和民营企业的研发投入产生促进作用。     

经济政策不确定性、会计稳健性与公司投资效率——中国A股上市的民营企业为证据

文章以中国A股上市的民营企业2014-2018年度财务报告数据为研究对象，探讨了经济政策不确定性、会计稳健性对公司投资效率的影响。文章实证显示，经济政策不确定性加重公司非效率性投资；会计稳健性在公司投资活动中具有治理作用，能够有效缓解企业过度投资，提高投资效率，然而会计稳健性对缓解公司投资不足的作用不明显；会计稳健性是对经济政策不确定性的一种谨慎反应，可以抑制经济政策不确定公司投资效率的负面影响。     

On Corporate Tax Asymmetries and Neutrality

This article discusses the effects of corporate tax asymmetries under investment irreversibility. We introduce a tax scheme where the tax base is given by the firm's return net of a rate of relief. When the firm's return is less than the imputation rate, however, no tax refunds are allowed. Unlike symmetric tax systems, the scheme proposed is neutral with respect not only to income uncertainty but also to policy uncertainty.     

The Credit Channel of Capital Tax Policy

A neoclassical growth model is augmented by a corporate sector, financial intermediation, and a set of tax rates. In this setting, capital structure is determined by the interplay between a tax advantage of debt finance and costly state verification entailed by asymmetric information. Effects of capital tax reforms are investigated with a special focus on this micro‐founded credit channel of tax policy. The theoretical part of the paper establishes a new, institution‐based view on the motivation of debt finance in general equilibrium and derives financial and real effects of private and corporate income tax policies. Using a calibration with U.S. data, the applied part demonstrates that tax cuts cause significant adjustments of capital structure. Nevertheless, it turns out that the credit channel generates relatively small effects of tax reforms on consumption, investment, and growth.     

Corporate Tax Incentives for R&D Investment in OECD Countries

Differentiating internal equity from debt finance, this study examines the generosity of R&D-specific tax incentives in OECD countries based on an NPV model. The corporate tax system generally favours debt finance and some previous findings on the possible preponderance of internal equity for financing R&D investment cannot be explained in relation to R&D-specific tax concessions. The OECD comparison demonstrates that R&D tax allowances adopted in the Czech Republic, Belgium, the UK, Denmark, Hungary, Austria and Australia generated the most substantial tax savings in 2006. Combined with such incentives, the after-tax NPV increases with the corporate tax rate, suggesting stronger investment stimulation through a tax-rate-increase-cum-base-broadening policy.     

The Welfare of Investment Deductibility Under a Flat Tax

This paper analyses the welfare effects of investment deductibility in a contest of endogenous growth generated by learning–by–doing and knowledge spillovers. We present a model where a set of revenue neutral fiscal policies, each characterized by different degrees of investment deductibility and different uniform tax rates on income, have been introduced. We show that, given the ratio of public expenditures to national product, partial investment deductibility turns out to be welfare enhancing when the intertemporal elasticity of substitution of consumption is sufficiently small. Our result means that a pure consumption tax—although ensuring more saving and faster growth—is not always preferable to a revenue neutral tax system in which both consumption and investment are taxed.     

Investment incentives and corporate tax asymmetries

Recent facts on the importance of corporate losses motivate more careful study of the impact of tax incentives for investment on firms that lose money. I model firm investment decisions in a setting featuring financing constraints and carrybacks and carryforwards of operating losses. I estimate investment responses to tax incentives allowing effects to vary with cash flows and taxable status. Results suggest that asymmetries in the corporate tax code could have made recent bonus depreciation tax incentives at most 4% less effective than they would have been if all firms were fully taxable. Cash flows have more important effects on the impact of tax incentives. Recent declines in cash flows would predict a 24% decrease in the effectiveness of bonus depreciation. Results thus suggest that tax incentives have the smallest impact on investment exactly when they are most likely to be put in place — during downturns in economic activity when cash flows are low.     

Tax Policy When Countries Compete for Third Market Exports

We examine the welfare and other consequences of tax policy in a third market export model where duopolists located in two countries compete in prices. With tax competition between governments, we allow for welfare‐maximizing governments in the two countries to delegate tax setting responsibility to policy‐makers who have different objectives than the governments. The unique equilibrium in the tax competition environment involves both governments delegating tax setting responsibility to tax revenue‐maximizing policy‐makers. This equilibrium yields higher welfare for both countries than the outcome when the governments delegate to welfare‐maximizing policy‐makers. The paper also compares tax competition with tax harmonization and shows that when the entire export market is served, tax harmonization improves the welfare of the country that houses the low cost firm, while the other country may be immiserized.     

江苏省研发费用加计扣除政策的实施现状及对策研究

近几年来,江苏省各级政府采取各项措施,加大落实企业研发费用加计扣除政策的力度,鼓励企业开展自主创新,并取得了积极的成效,可为全国提供一定的借鉴和启示。基于江苏省税收减免的统计数据,对研发费用加计扣除政策的执行情况进行了分析,阐明了政策落实的效果和存在的不足,综合分析了政策参与主体及影响因素,构建了政策实施流程模型,并结合江苏省具体现状,针对政策实施中的不足,提出了对策建议,以便进一步提高政策实施效果。     

促进区域经济协调发展的税收对策

我国区域经济差距过大的税收政策存在税率相同而实际税负不一,税种设计、税收政策不合理,应利用税收政策刺激企业投资,实行差别税率,调整主要税种和完善税收优惠政策。     

Taxation and Investment Decisions: A Real Options Approach

The purpose of the paper is to analyse the impact of the tax system on the firm's incentives to invest and disinvest in an uncertain environment. This paper follows the real options approach, which allows us to investigate the value to a firm of waiting to invest and/or disinvest, when payoffs are stochastic and investments partially reversible. The implications for the magnitude and directions of the effects of tax policy are studied; also the case of tax policy uncertainty is examined.     

税收优惠与企业创新绩效 ——基于研发投入和非研发创新投入的双重中介效应

税收优惠政策对企业创新绩效的影响广受关注,其传导机制更是一个有待深入探讨的问题。基于2000-2015年全国规模以上工业企业的省级面板数据,采用中介效应分析方法,研究税收优惠对企业创新绩效的影响,并运用面板门槛模型对两者之间的非线性关系进行探讨。结果表明:税收优惠一方面可以直接对创新绩效产生正向推动作用,另一方面可以通过研发投入和非研发创新投入发挥部分中介效应,间接提高企业的创新绩效,中介效应值为39.5%,且两者还存在着正向的协同效应。同时这种内在的传导机制存在着区域异质性:对于东部沿海地区而言,研发投入和非研发创新投入同时发挥中介效应;但是对于中西部地区而言,非研发创新投入的中介效应不显著。而且税收优惠对企业创新绩效的促进效果并非一成不变,而是随着研发投入和非研发创新投入的逐渐增加呈递增态势。因此,进一步地加大税收优惠力度的同时,合理规划自主研发和外源技术的资金安排,有利于实现企业创新绩效的最大化。