Corporate tax view

Corporate tax view

The argument that double (corporate and individual) taxation of equity returns makes debt a cheaper financing method.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Corporate Tax View

An argument stating that double taxation makes the issuing of stocks more expensive than debt financing. That is, those who hold the corporate tax view argue that since the owners of a corporation must pay both corporate taxes and individual taxes, rather than forming a corporation and issuing stock, owners of the corporation ought to consider borrowing, as it is a cheaper way to pay for expanded operations in the long run.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
Full browser ?