Taxation and Leverage in International Banking / / Grace Weishi Gu, Ruud A. Mooij, Tigran Poghosyan

• Record Nr.: UNINA9910779643003321
• Autore: Gu Grace Weishi
• Pubbl/distr/stampa: Washington, D.C. : , : International Monetary Fund, , 2012
• ISBN: 1-4755-5221-1; 1-4755-4068-X
• Descrizione fisica: 1 online resource (36 p.)
• Collana: IMF Working Papers
• Altri autori (Persone): MooijRuud A; PoghosyanTigran
• Soggetti: Taxation - Econometric models; Financial leverage - Econometric models; Banks and Banking; Financial Risk Management; Taxation; Corporate Taxation; Personal Finance -Taxation; Banks; Depository Institutions; Micro Finance Institutions; Mortgages; Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill; Business Taxes and Subsidies; Financial Institutions and Services: Government Policy and Regulation; Financial Crises; Taxation, Subsidies, and Revenue: General; Personal Income and Other Nonbusiness Taxes and Subsidies; Banking; Corporate & business tax; Economic & financial crises & disasters; Public finance & taxation; Corporate income tax; Deposit insurance; Financial crises; Debt bias; Taxes; Tax policy; Tax allowances; Banks and banking; Corporations; Crisis management; Tax administration and procedure; Income tax; United States
• Lingua di pubblicazione: Inglese
• Formato: Materiale a stampa
• Livello bibliografico: Monografia
• Note generali: Description based upon print version of record.
• Nota di bibliografia: Includes bibliographical references.
• Nota di contenuto: Cover; Contents; I. Introduction; II. Theoretical Model; III. Empirical Methodology and Data; A. Methodology; B. Data; IV. Results; A. Baseline Regressions; B. Robustness Checks; C. Extension: Capital Tightness; V. Conclusions; References; Technical Appendix; Figures; 1. Bank Leverage Histogram; Tables; 1. Variable Source and Construction; 2. Summary Statistics; 3. Correlations; 4. Number of Banks; 5. Average Financial Leverage and Tax Rates; 6. Baseline Estimation Results; 7. Robustness Check Estimation Results: Standard Errors; 8. Robustness Check Estimation Results: Alternatives; 9. Robustness Check Estimation Results: Leverage Skewness and Tax Trend 10. Robustness Check Estimation Results: Subsamples; 11. Estimation Results: Capital Tightness
• Sommario/riassunto: This paper explores how corporate taxes affect the financial structure of multinational banks. Guided by a simple theory of optimal capital structure it tests (i) whether corporate taxes induce subsidiary banks to raise their debt-asset ratio in light of the traditional debt bias; and (ii) whether international corporate tax differentials vis-a-vis foreign subsidiary banks affect the intra-bank capital structure through international debt shifting. Using a novel subsidiary-level dataset for 558 commercial bank subsidiaries of the 86 largest multinational banks in the world, we find that taxes matter significantly, through both the traditional debt bias channel and the international debt shifting that is due to the international tax differentials. The latter channel is more robust and tends to be quantitatively more important. Our results imply that taxation causes significant international debt spillovers through multinational banks, which has potentially important implications for tax policy.