Changes in corporate capital structures: evidence from the 1986 Tax Reform Act

Article Abstract:

Firms showed a tendency to issue more debt after the 1986 Tax Reform Act. This was gleaned from an examination of the influence of the Tax Reform Act on firms' issue behavior and the determinants of corporate capital structures, using choice-theoretic models which allow researchers to analyze firms' leverage decisions at the margin. The increase in debt levels after 1986 is attributed to the Act's reduction of the maximum tax rate for corporate income and for individual income, resulting in a higher net tax advantage of debt, as well as its elimination of the investment tax credit.

Research, Tax reform, Debt financing (Corporations), Debt financing, Capital

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Creating a meaningful working capital guarantee program for the small exporter: the case of the U.S. Eximbank

Article Abstract:

The implementation of Working Capital Guarantee Program (WCGP) by the Export-Import Bank of America proves to be beneficial in promoting financial help to small and new exporters. The proven financial benefits that financial institutions can derived from joining WCGP, such as faster turnaround, results to greater participation of banks in providing financial help to exporters. Better utilization of the program will result if companies will undertake several measures such as appointment of managers that have competency in domestic credit management.

Export-Import Bank, Banking industry, Finance, Small business, Economic policy, Export-Import Bank of the United States, Working capital

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Multinationality of U.S. corporations: the tax implications

Article Abstract:

The tax responsibility of U.S. multinational corporations in their country and their tax responsibility in the countries where they have established a presence is presented. The tax responsibilities include sections on sources of income, transfer pricing, personal property sales, transfers of tangible property, dividends and income recepient status. Also presented are analysis of laws wherein double taxation on foreign tax credit, foreign sales corporations and tax treaties are avoided.

Taxation, International business enterprises, Multinational corporations

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