Changes in corporate effective tax rates over the past 25 years

Scott D. Dyreng, Michelle Hanlon, Edward L. Maydew and Jacob R. Thornock

Journal of Financial Economics, 2017, vol. 124, issue 3, 441-463

Abstract: We investigate systematic changes in corporate effective tax rates over the past 25 years and find that effective tax rates have decreased significantly. Contrary to conventional wisdom, the decline in effective tax rates is not concentrated in multinational firms; effective tax rates have declined at approximately the same rate for both multinational and domestic firms. Moreover, within multinational firms, both foreign and domestic effective rates have decreased. Finally, changes in firm characteristics and declining foreign statutory tax rates explain little of the overall decrease in effective rates.

Keywords: Tax; Effective tax rates; Tax avoidance; Time trend; Foreign taxes; Domestic taxes (search for similar items in EconPapers)
JEL-codes: G38 H25 H26 H32 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (106)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:124:y:2017:i:3:p:441-463

DOI: 10.1016/j.jfineco.2017.04.001

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