Interest Barrier and Capital Structure Response

S. Alberternst, C. Sureth-Sloane, Interest Barrier and Capital Structure Response, 2016.

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Abstract
The Organisation for Economic Co-Operation and Development (OECD) recently proposed an interest barrier to fight tax base erosion and profit shifting (BEPS). We use the introduction of such an interest deductibility restriction in Germany as a quasi-experiment and find significant corporate capital structure responses. Using single entity financial statements and a detailed matching approach, we find evidence that companies that are affected by the interest barrier reduce their leverage by 4.7 percentage points more than non-affected companies. The effects are stronger among non-financially constrained firms. Our results imply that interest barrier effects on capital structure have so far been heavily underestimated.
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206
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Alberternst S, Sureth-Sloane C. Interest Barrier and Capital Structure Response. Vol 206.; 2016.
Alberternst, S., & Sureth-Sloane, C. (2016). Interest Barrier and Capital Structure Response (Vol. 206).
@book{Alberternst_Sureth-Sloane_2016, series={arqus, Quantitative Research in Taxation}, title={Interest Barrier and Capital Structure Response}, volume={206}, author={Alberternst, Stephan and Sureth-Sloane, Caren}, year={2016}, collection={arqus, Quantitative Research in Taxation} }
Alberternst, Stephan, and Caren Sureth-Sloane. Interest Barrier and Capital Structure Response. Vol. 206. Arqus, Quantitative Research in Taxation, 2016.
S. Alberternst and C. Sureth-Sloane, Interest Barrier and Capital Structure Response, vol. 206. 2016.
Alberternst, Stephan, and Caren Sureth-Sloane. Interest Barrier and Capital Structure Response. Vol. 206, 2016.
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