Taxes and Financial Reporting: Evidence from Discretionary Investment Write-Offs in Italy

This paper provides further empirical evidence on the relationship between taxes and financial reporting by focusing on accounting decisions to write-offs equity investments. The analysis is based on panel data for Italian companies. In the period 1998-2006 the Italian corporate income tax has been reformed several times. In particular the tax deductibility of write-offs of equity investment was repealed in 2004. The paper exploits the ensuing high cross-sectional and times series variation in the marginal tax rate to identify tax effects. The econometric analysis delivers strong evidence that taxes affect the probability of write-offs. In contrast there is no evidence that taxes affect the magnitude of the write-offs. The paper also tests for the existence of a trade-off between tax minimization and non tax costs such as financial reporting costs and agency costs. Surprisingly, the evidence of such trade-off is rather weak.corporate taxation, write-offs of equity investments, financial reporting, tax planning

Taxation Policy in EMU - Julian Alworth and Giampaolo Arachi

This paper proposes to examine whether and how the introduction of the euro changed the impact of taxes on the economy or influenced the direction of tax policy. The paper surveys potential theoretical channels through which tax policy and exchange rate regimes are interrelated (capital mobility, strategic tax setting and trade policy). It is difficult to find strong empirical evidence of major, unique changes in the impact or determination of tax policy following the introduction of the euro owing. The internal market has had by far a greater impact and it has affected all European Union countries. Nevertheless, we highlight that going forward certain specific aspects deserve attention. The most important concerns the use of tax policy by individual EMU countries to improve competitiveness by changing the mix of taxes and thereby achieving an internal devaluation.  A second issue deserving attention concerns tax competition particularly in the area of corporation tax. We provide some tentative evidence that capital movements to and from euro area countries have become more responsive to the levels of corporate taxation.  Alworth, Arachi, EMU, corporate taxation, value-added tax, trade, VAT

Taxes and financial reporting: Evidence from discretionary investment write-offs in Italy

This paper provides further empirical evidence on the relationship between taxes and financial reporting by focusing on accounting decisions to write-offs equity investments. The analysis is based on panel data for Italian companies. In the period 1998-2006 the Italian corporate income tax has been reformed several times. In particular the tax deductibility of write-offs of equity investment was repealed in 2004. The paper exploits the ensuing high cross-sectional and times series variation in the marginal tax rate to identify tax effects. The econometric analysis delivers strong evidence that taxes affect the probability of write-offs. In contrast there is no evidence that taxes affect the magnitude of the write-offs. The paper also tests for the existence of a trade-off between tax minimization and non tax costs such as financial reporting costs and agency costs. Surprisingly, the evidence of such trade-off is rather weak

07/13/1989 - Winters Commissioned

Solo tenendo conto della dimensione storica dei fenomeni analizzati e del contesto istituzionale in cui essi si collocano, la teoria economica può essere un potente strumento di lettura della realtà. Questa visione ha da sempre caratterizzato la ricerca di Roberto Artoni e ha costituito fonte di ispirazione per generazioni di studenti oggi attivi nell'accademia e nelle istituzioni, sia in Italia sia all'estero. La prima parte del volume presenta una serie di saggi nei quali alcuni dei suoi allievi riflettono sugli sviluppi dell'economia pubblica degli ultimi anni ripercorrendo i temi che più hanno segnato l'attività scientifica di Artoni. La seconda sezione raccoglie i suoi più recenti contributi sull'evoluzione dell'economia italiana, sul ruolo dello Stato sociale, sulle origini della crisi economica e sulla difficoltà degli economisti di prevederla e di interpretarla