蝌蚪网 Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
The Costs of Corporate Tax Complexity
蝌蚪网 Journal: Economic Policy
(pp. 467–500)
Abstract
Does tax code complexity alter corporate behavior? We investigate this question by studying the decision to claim refunds for tax losses. In a sample of 1.2 million observations from the population of corporate tax returns, only 37 percent of eligible firms claim their refund. A simple cost-benefit analysis of the tax loss choice cannot explain low take-up, motivating an exploration of how complexity alters this calculation. Research designs exploiting tax preparer switches, deaths, and relocations show that sophisticated preparers increase claim rates for small firms. Imperfect take-up has implications for measuring marginal tax rates and for the design of fiscal policy.Citation
Zwick, Eric. 2021. "The Costs of Corporate Tax Complexity." 蝌蚪网 Journal: Economic Policy 13 (2): 467–500. DOI: 10.1257/pol.20180406Additional Materials
JEL Classification
- D22 Firm Behavior: Empirical Analysis
- D61 Allocative Efficiency; Cost-Benefit Analysis
- E62 Fiscal Policy
- H25 Business Taxes and Subsidies including sales and value-added (VAT)
- K34 Tax Law