Neutral taxation of shareholder income? Corporate responses to an announced dividend tax
Annette Alstadsæter () and
Erik Fjærli ()
International Tax and Public Finance, 2009, vol. 16, issue 4, 571-604
The introduction of the 2006 Norwegian shareholder income tax was announced in advance, and it increased top marginal tax rates on individual dividend income from zero to 28%. We document strong timing effects on dividend payout on a large panel of non-listed corporations, with a surge of dividends prior to 2006 and a sharp drop after. Mature firms are more likely to pay dividends, and high asset growth increases the probability of retaining all earnings. Intertemporal income shifting through the timing of dividends seems to be a drain on internal equity and cause increases in the corporations’ debt–equity ratios. The debt ratios drop sharply after the implementation of the reform. Copyright Springer Science+Business Media, LLC 2009
Keywords: Neutral dividend tax; Dual income tax; Intertemporal income shifting; Anticipation effects; Corporate financial policy; Transition; G32; G35; H24; H25 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (4) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
Working Paper: Neutral Taxation of Shareholder Income? Corporate Responses to an Announced Dividend Tax (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:kap:itaxpf:v:16:y:2009:i:4:p:571-604
Ordering information: This journal article can be ordered from
http://www.springer. ... ce/journal/10797/PS2
Access Statistics for this article
International Tax and Public Finance is currently edited by Ronald B. Davies and Kimberly Scharf
More articles in International Tax and Public Finance from Springer, International Institute of Public Finance Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla ().