The capital gains tax: A curse but also a blessing for venture capital investment

Ann-Kristin Achleitner, Carolin Bock and Martin Watzinger

No 2011-04, CEFS Working Paper Series from Technische Universität München (TUM), Center for Entrepreneurial and Financial Studies (CEFS)

Abstract: This article documents a statistical association between the number and success of venture capital investments and the capital gains tax rate. To do this, we analyze investment data and taxes of 32 countries from 2000 to 2010. In our data, higher capital gains tax rates are associated with fewer firms financed and a lower probability for ventures receiving follow-up funding. However, if the first investment is received when taxes are high, the probability of a firm eventually going public or being acquired increases. We conclude that high tax rates are associated with fewer, but on average more successful companies.

Keywords: capital gains tax; venture capital; investment (search for similar items in EconPapers)
JEL-codes: G24 H25 H32 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-acc, nep-ent and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://www.econstor.eu/bitstream/10419/50558/1/669829137.pdf (application/pdf)

Related works:
Journal Article: The Capital Gains Tax: A Curse but Also a Blessing for Venture Capital Investment (2019)
Working Paper: The Capital Gains Tax: A Curse but also a Blessing for Venture Capital Investment (2019)
Working Paper: The Capital Gains Tax: A Curse but Also a Blessing for Venture Capital Investment (2017)
Working Paper: The Capital Gains Tax: A Curse but also a Blessing for Venture Capital Investment (2013)
Working Paper: The Capital Gains Tax: A Curse but also a Blessing for Venture Capital Investment (2012)
Working Paper: The Capital Gains Tax: A Curse but also a Blessing for Venture Capital Investment (2012)
Working Paper: The Capital Gains Tax: A Curse but also a Blessing for Venture Capital Investment (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cefswp:201104

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