Taxing the digital economy investor reaction to the European Commission’s digital tax proposals Daniel Klein, Christopher A. Ludwig and Christoph Spengel
By: Klein, Daniel
.
Contributor(s): Ludwig, Christopher A | Spengel, Christoph.
Material type: 
ArticleSubject(s): ECONOMÍA DIGITAL | IMPUESTOS | IMPUESTO DE SOCIEDADES | UNION EUROPEA | EMPRESAS | ESTADOS UNIDOS
In:
National Tax Journal v. 75, n. 1, March 2022, p. 61-92Summary: This study analyzes investor reaction to the European Commission’s proposals on the taxation of digital firms. Examining the stock returns of potentially affected firms surrounding the proposals’ release, we find a significant abnormal capital market reaction of −0.692 percent. This corresponds to an absolute market value reduction of more than 52 billion euros, 40 percent of which is attributable to US firms. Investor reaction is stronger for firms that engage more in tax avoidance and for those with higher European Union exposure. Overall, investors perceive the event as a threat to digital firms’ future profitability and react in line with the proposals’ intentions to secure tax revenues and to extract location-specific rent.
| Item type | Current location | Home library | Call number | Status | Date due | Barcode |
|---|---|---|---|---|---|---|
| Artículos | IEF | IEF | OP 233/2022/1-3 (Browse shelf) | Available | OP 233/2022/1-3 |
Browsing IEF Shelves Close shelf browser
| No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | ||
| OP 233/2022/1 National Tax Journal | OP 233/2022/1-1 Homestead exemptions, heterogeneous assessment, and property tax progressivity | OP 233/2022/1-2 Property tax compliance and reverse mortgages | OP 233/2022/1-3 Taxing the digital economy | OP 233/2022/1-4 Forum | OP 233/2022/2 National Tax Journal | OP 233/2022/2-1 Appreciating a practitioner and scholar on a mission to improve fiscal policy |
Resumen
Bibliografía.
This study analyzes investor reaction to the European Commission’s proposals on the taxation of digital firms. Examining the stock returns of potentially affected firms surrounding the proposals’ release, we find a significant abnormal capital market reaction of −0.692 percent. This corresponds to an absolute market value reduction of more than 52 billion euros, 40 percent of which is attributable to US firms. Investor reaction is stronger for firms that engage more in tax avoidance and for those with higher European Union exposure. Overall, investors perceive the event as a threat to digital firms’ future profitability and react in line with the proposals’ intentions to secure tax revenues and to extract location-specific rent.
Click on an image to view it in the image viewer
There are no comments for this item.