Corporate Inversion
Title | Corporate Inversion PDF eBook |
Author | United States. Congress. Senate. Committee on Appropriations. Subcommittee on Treasury and General Government |
Publisher | |
Pages | 72 |
Release | 2003 |
Genre | Business relocation |
ISBN |
Are Corporate Inversions Good for Shareholders?
Title | Are Corporate Inversions Good for Shareholders? PDF eBook |
Author | Anton Babkin |
Publisher | |
Pages | 59 |
Release | 2019 |
Genre | |
ISBN |
Corporate inversion, the process of redomiciling for tax purposes, reduces corporate income taxes, but it imposes a personal tax cost that is shareholder-specific. We develop a model, incorporating the corporate tax benefits and personal tax costs, to quantify the return to inversion for different shareholders. Foreign and tax-exempt investors, along with the chief executive officer, disproportionately benefit. We show that an inversion simultaneously reduces the wealth of many taxable shareholders. The model illustrates an agency conflict in which heterogeneity in personal taxes generates a wealth transfer between shareholders. Furthermore, personal taxes offset the loss in government revenue by 39%.
Corporate inversions
Title | Corporate inversions PDF eBook |
Author | United States. Congress. House. Committee on Ways and Means |
Publisher | |
Pages | 60 |
Release | 2002 |
Genre | Business & Economics |
ISBN |
Corporate inversions
Title | Corporate inversions PDF eBook |
Author | United States. Congress. House. Committee on Ways and Means |
Publisher | |
Pages | 56 |
Release | 2002 |
Genre | Business & Economics |
ISBN |
How U.S. Corporate Inversions Impact Shareholder Value
Title | How U.S. Corporate Inversions Impact Shareholder Value PDF eBook |
Author | MaryKate MacDonald |
Publisher | |
Pages | |
Release | 2017 |
Genre | |
ISBN |
This report examines how U.S. corporate tax inversion announcements impact shareholder value. A corporate tax inversion is where a corporation moves its location of residency to a new jurisdiction with a lower tax rate than that of its original location of incorporation. Corporate operations are usually continued in the location with the higher federal effective tax rate. Since the first U.S. inversion in 1983, there have been more than 75 inversions (Marples & Gravelle, 2016). There has been growing division over the issue of whether or not inversions are acceptable as a result of the U.S. tax base deteriorating. Many politicians have been searching for ways to control the number of inversions through legislation. As a result, inversion trends have been changing due to governmental regulation, international business, and public opinion. For this analysis, data is collected on 49 corporate inversions that occur from 1983 to 2016. Event studies are conducted on individual trends to determine what types of inversions create the most value. Results indicate that pharmaceutical corporations completing merger and acquisition (M&A) inversions in Ireland after 2007 are valued the most by shareholders.
Corporate inversions
Title | Corporate inversions PDF eBook |
Author | United States. Congress. House. Committee on Ways and Means. Subcommittee on Select Revenue Measures |
Publisher | |
Pages | 88 |
Release | 2002 |
Genre | Business & Economics |
ISBN |
Corporate inversions
Title | Corporate inversions PDF eBook |
Author | United States. Congress. House. Committee on Ways and Means. Subcommittee on Select Revenue Measures |
Publisher | |
Pages | 80 |
Release | 2002 |
Genre | Business relocation |
ISBN |