Taxation and Corporate Group Structure - Evidence from a Sample of European Multinationals

Andreas Oestreicher and Reinald Koch

Schmalenbach Business Review (sbr), 2012, vol. 64, issue 4, 254-280

Abstract: We empirically analyze the influence of tax considerations on the structure of investments of a parent company based in one EU member state that holds subsidiaries in a different member state. We show that group taxation, deductibility of financing expenses, or participation write-downs and additional taxes on intragroup dividends may factor into the parent company’s decision on the structure of investments as tax parameters. We find empirical evidence that a vertical structure with a pure holding interposed is implemented more often if a domestic parent entity is required for the formation of a tax group, the semi-elasticities being 0.568 and –0.343.

Keywords: Corporate Group Structure; Corporate Income Tax; Firm-Level Data; Multinationals (search for similar items in EconPapers)
JEL-codes: F23 H25 K34 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:sbr:abstra:v:64:y:2012:i:4:p:254-280

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