{
  "title": "Taxation and Corporate Debt: Are Banks any Different?",
  "publication": "IMF Working Papers, October 29, 2013",
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  "summary": "This paper explores whether corporate tax bias toward debt finance differs between banks and nonbanks, using a large panel of micro data. On average, it finds that there is no significant difference. The marginal tax effect for both banks and non-banks is close to 0.2.",
  "sections": [
    {
      "heading": "Core findings",
      "content": "- The paper investigates whether corporate tax bias toward debt finance differs between banks and nonbanks using a large panel of micro data.\n- On average, there is no significant difference between banks and non-banks.\n- The marginal tax effect for both banks and non-banks is close to 0.2.\n- Responsiveness to tax incentives differs considerably across the asset size distribution and the conditional leverage distribution."
    },
    {
      "heading": "Patterns by firm type and size",
      "content": "- Nonbanks:\n  - Exhibit a U-shaped relationship between asset size and tax responsiveness.\n  - The U-shaped pattern does not hold universally across the conditional leverage distribution.\n- Banks:\n  - Tax responsiveness declines linearly in asset size.\n  - Quantile regressions indicate capital-tight banks are significantly less responsive than capital-abundant banks.\n  - Even the largest banks with high conditional leverage ratios still display a significant, positive tax response."
    },
    {
      "heading": "Quantile-regression insights",
      "content": "- Quantile regressions reveal heterogeneity in tax responsiveness across the conditional leverage distribution:\n  - Capital-tight banks: significantly less responsive to tax incentives.\n  - Capital-abundant banks: more responsive to tax incentives.\n  - The same pattern of lower responsiveness for capital-tight firms holds for the largest non-banks.\n- Despite lower responsiveness in capital-tight segments, significant positive tax responses remain for the largest banks with high conditional leverage ratios."
    },
    {
      "heading": "Subjects and keywords (as listed)",
      "content": "- Subjects: Bank levy, Banking, Collateral, Corporate income tax, Debt bias, Financial institutions, Inflation, Prices, Tax policy, Taxes\n- Keywords: bank, bank assets, bank choice, bank dummy, Bank levy, banks, capital structure regression, Collateral, Corporate income tax, Corporate tax, debt, debt bias, Global, Inflation, leverage, leverage ratio, non-financial firms, quantile, quantile regressions, size distribution, WP\n\n---\n\n Content in this bundle\n\n- wp13221\n  - wp13221 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp13221 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/taxation-and-corporate-debt-are-banks-any-different-41019"
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    "Authors: Jost Heckemeyer, Ruud A. de Mooij",
    "Published: October 29, 2013",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781484330340.001",
    "The paper investigates whether corporate tax bias toward debt finance differs between banks and nonbanks using a large panel of micro data.",
    "On average, there is no significant difference between banks and non-banks.",
    "The marginal tax effect for both banks and non-banks is close to 0.2.",
    "Responsiveness to tax incentives differs considerably across the asset size distribution and the conditional leverage distribution.",
    "Nonbanks:",
    "Banks:",
    "Quantile regressions reveal heterogeneity in tax responsiveness across the conditional leverage distribution:",
    "Despite lower responsiveness in capital-tight segments, significant positive tax responses remain for the largest banks with high conditional leverage ratios.",
    "Subjects: Bank levy, Banking, Collateral, Corporate income tax, Debt bias, Financial institutions, Inflation, Prices, Tax policy, Taxes",
    "Keywords: bank, bank assets, bank choice, bank dummy, Bank levy, banks, capital structure regression, Collateral, Corporate income tax, Corporate tax, debt, debt bias, Global, Inflation, leverage, leverage ratio, non-financial firms, quantile, quantile regressions, size distribution, WP",
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