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Business and Economics > Corporate Taxation

You are looking at 1 - 3 of 3 items for :

  • Type: Journal Issue x
  • Papua New Guinea x
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Cover IMF Working Papers
Curbing Corporate Debt Bias
Ruud A. de Mooij
and
Mr. Shafik Hebous
Tax provisions favoring corporate debt over equity finance (“debt bias”) are widely recognized as a risk to financial stability. This paper explores whether and how thin-capitalization rules, which restrict interest deductibility beyond a certain amount, affect corporate debt ratios and mitigate financial stability risk. We find that rules targeted at related party borrowing (the majority of today’s rules) have no significant impact on debt bias—which relates to third-party borrowing. Also, these rules have no effect on broader indicators of firm financial distress. Rules applying to all debt, in contrast, turn out to be effective: the presence of such a rule reduces the debt-asset ratio in an average company by 5 percentage points; and they reduce the probability for a firm to be in financial distress by 5 percent. Debt ratios are found to be more responsive to thin capitalization rules in industries characterized by a high share of tangible assets.
Keywords:
WP; dependent variable; TCR rule; Corporate tax; capital structure; debt bias; thin capitalization rule; interest deductibility; TCR variable; so-called thin capitalization rules; EBITDFA percentage; debt-asset ratio; tcrs in industry; uniform tcrs; TCR type; Corporate income tax; Thin capitalization rules; Financial statistics; Global
Cover IMF Working Papers
Modeling the Impact of Taxes on Petroleum Exploration and Development
Mr. James L. Smith
We present a simple model of petroleum exploration and development that can be applied to study the performance of alternative tax systems and identify potential distortions. Although the model is a highly simplified, it incorporates many factors and some of the key tradeoffs that would influence an investor’s investment behavior. The model recognizes the role of enhanced oil recovery and treats the impact of taxation on exploration and development in an integrated manner consistent with an investor’s joint optimization of investments at both stages of the process. The model is simple and user-friendly, which facilitates application to a broad range of problems.
Keywords:
WP; net present value; cash flow; petroleum exploration; oil production; taxation; distortions; IOC place; IOC's profit; price movement; fiscal regime; IOC NPV; oil price; economic value; Oil; Oil prices; Corporate income tax; Marginal effective tax rate; Production sharing; Middle East
Cover IMF Staff Country Reports
Papua New Guinea: Selected Issues and Statistical Appendix
International Monetary Fund
This paper examines and tests the existence of political budget cycles in Papua New Guinea during the period 1988–2004. Several factors point to the existence of political budget cycles in Papua New Guinea. The paper provides an overview of the political business cycle literature, and Papua New Guinea’s political structure and processes. It also describes the data set and the empirical methods used to test for the presence of election-influenced spending, and presents the results of a time-series analysis.
Keywords:
ISCR; CR; election; tax rate; rate; election period; development expenditure; election-year extravagance; excise tax; excise rate; tariff reform program; tariff rate; import tariff arrangement; Income and capital gains taxes; Mining sector; Tariffs; Corporate income tax; Global