Work

Who gains from corporate tax cuts?

Year: 2024

Type: article

Abstract: Goods producers increase their capital expenditure and employment in response to a cut in marginal corporate income tax rates or an increase in investment tax credits. In contrast, companies in the service sector mostly use any tax windfall to increase dividend payouts. We base our conclusions on a novel measure of U.S. firm-specific tax shocks that combines changes in statutory tax rates faced by each firm with narrative identified legislated U.S. federal tax changes between 1950 and 2006.

Source: Journal of Monetary Economics

DOI: 10.1016/j.jmoneco.2024.103722

Authors: James Cloyne, Ezgi Kurt, Paolo Surico

Institutions: Centre for Economic Policy Research, University of California, Davis, Bentley University, London Business School

Language: English

Topic: Corporate Taxation and Avoidance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: hybrid

Estimated APC paid: $3,870