CAPITAL GAINS TAXATION AND STOCK MARKET INVESTMENTS: EMPIRICAL EVIDENCE

Akinloye Akindayomi

Accounting & Taxation, 2013, vol. 5, issue 2, 1-12

Abstract: The objective of this study is to examine stock market investments responses to changes in capital gains tax rate. A priori, rational taxpayers are expected to respond to changes in this tax rate. For example, a reduction (increase) in capital gains tax rates may make taxpayers to unlock (lock-in) substantial amounts of accrued (realizable) appreciated gains. The findings of this study however reveal that capital gains realization and not capital gains tax rates impacts stock market investments in the U.S.

Keywords: Stock Market Investment; Capital Gains Tax Rates; Realized Capital Gains (search for similar items in EconPapers)
JEL-codes: M40 M41 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (1)

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