The effects of corporate taxes on small firms
Harju, Jarkko; Koivisto, Aliisa; Matikka, Tuomas (2022-08)
Harju, Jarkko
Koivisto, Aliisa
Matikka, Tuomas
08 / 2022
104704
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:tuni-202208046219
https://urn.fi/URN:NBN:fi:tuni-202208046219
Kuvaus
Peer reviewed
Tiivistelmä
We study the impact of corporate taxes on firm-level investments and business activity by exploiting a 6 percentage-point reduction in the corporate tax rate in 2012–2014 in Finland. We use detailed administrative data and a difference-in-differences method comparing small corporations (tax rate cuts) to similar partnerships (no change in taxes). We find no significant average investment responses but do observe an average increase in annual sales (1.6%) and variable costs (2%) when comparing years before (2008–2011) and after (2014–2016) the tax rate cuts. These effects are driven by more cash-constrained firms and firms where the main owner actively works in the firm.
Kokoelmat
- TUNICRIS-julkaisut [18886]