IMPACTS OF FISCAL REFORM ON DIVIDENDS: EVIDENCE FROM MEXICO

Jose Asuncion Corona Duenas and Cesar Corona Pacheco

Accounting & Taxation, 2019, vol. 11, issue 1, 71-81

Abstract: This paper addresses the Mexican 2014 Tax Reform. Specifically, we examine the distribution of dividends made by thirty-five companies that make up the Price and Quotation Index of the Mexican Stock Exchange. We also examine shareholders who receive the dividends. Results show that companies refrained from declaring dividends in 2014 and payments normalized in 2015. Since 2015, as a result of the 2014 Tax Reform, which required shareholders who receive dividends to pay an extra tax of 10%, dividends have become les desirable. Companies have accumulated profits destined for reinvestment in the company

Keywords: Dividend Policy; Residual Theory; Tax Reform (search for similar items in EconPapers)
JEL-codes: G31 G38 (search for similar items in EconPapers)
Date: 2019
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