Dividend taxes And Share Prices: Evidence From Real Estate Investment trusts  

Oleh:

GENTRY, WILLIAM M. ; Kemsley, Deen ; J.MAYER, CHRISTOPHER

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: The Journal of Finance (EBSCO) vol. 58 no. 1 (Feb. 2003), page 261-282.
Topik: taxed; Dividend taxes
Fulltext: p 261.pdf (189.49KB)

Isi artikel

Prior empirical evidence regarding the impact of dividend taxes on firmvaluation is mixed.This study avoids some of the complications encountered in previous empirical work by exploiting institutional characteristics of REITs, such as their limited discretion over dividend policy and the relative transparency of REITassets.We regress the market value of equity on the market value of assets and tax basis, which creates tax deductions that lower future dividend taxes without affecting future pretax cash flow.We find that firm value is positively related to tax basis, suggesting that future dividend taxes are capitalized into share prices.

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