Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Evidence on Book-tax Differences and Disclosure Quality Based on the Notes to the Financial StatementsMaria Theresia Evers*, Katharina Finke*, Sebastian Matenaer**, Ina Meier**, Benedikt Zinn* July 2014Abstract: The German Accounting Law Modernization Act (BilMoG) represents a change in paradigm with regard to the traditionally close relationship between financial and tax accounting in Germany. At the same time, requirements on the disclosure of deferred taxes were revised considerably. We make use of these new disclosure provisions to disaggregate firms' deferred tax position and to analyze the components of temporary book-tax differences that add to the reporting gap in Germany. To this end, we apply a unique dataset of hand-collected information from individual financial statements for the fiscal year 2010. We find considerable differences between financial and tax accounting and observe that temporary book-tax differences are mainly associated with mandatory differences in accounting for provisions. The scope and quality of tax-related disclosures vary substantially and the overall disclosure quality is low. In order to identify the determinants of the heterogeneity of disclosure quality, we construct an index for voluntary and mandatory disclosure of deferred tax information and conduct multivariate analyses to explain firms' disclosure decisions. We show that the recognition of deferred tax assets and liabilities on the face of the balance-sheet is significantly and positively related with disclosure quality in the notes to the financial statements. Further, our results suggest that larger firms are more likely to have highquality tax disclosures and that high implementation costs could also explain the observed shortfalls in disclosure quality. Moreover, we find that different reporting incentives might apply if reporting on losses is assessed in isolation. We use these insights to derive implications for the discussion about whether and how to reform disclosure requirements under German GAAP. JEL Classification: H20, H25, K34, M41Keywords: book-tax conformity; book-tax differences; deferred taxes; disclosure quality; tax reporting
In this article we numerically explore the development of corporate tax burdens for the case of Germany during the time period between 1990 and 2010. We set up a model‐firm approach, which allows us to account separately for many complicated tax provisions, such as earning stripping rules or loss‐carryovers, in great detail and hence provide a comprehensive analysis of the tax systems in Germany, which extends the scope of existing literature. Furthermore, we present an analysis of the impact of the global economic and financial crisis on the effective tax burden of companies and evaluate the short‐term measures introduced by the German government to support economic activity. Although the global economic crisis has posed hard new questions, it also offers an opportunity to accelerate structural tax reforms and restart the discussion on the design of corporate taxation in Germany beyond short‐term policy responses. Therefore, we finally outline proposals to reform corporate taxation in Germany.
Sowohl die Ergebnisse der quantitativen als auch der qualitativen Analyse deuten darauf hin, dass die derzeitigen Bemessungsgrundlagenunterschiede zwischen den Mitgliedstaaten und dem GKKB-Richtlinienvorschlag verhältnismäßig gering sind. Obwohl einige offene Fragen ungeklärt bleiben, sind die Überlegungen der EU-Kommission zur Schaffung einer GK(K)B grundsätzlich mit den Zielen der steuerlichen Gewinnermittlung in der EU kompatibel und stellen einen konsensfähigen Vorschlag zur Harmonierung der Besteuerung in Europa dar.
Without any doubt, one of the primary policy issues in public finance in the European Union (EU) is the issue of tax competition, which results in a race to the bottom in statutory tax rates, tax base broadening policies, and potential distortions in firm decisions. The literature focuses mainly on profit taxes; however, as the financial crisis is biting into the real economy, non-profit taxes have become a more important factor in the overall tax burden on companies. In this context, one important question is whether non-profit taxation and tax base broadening policies have accelerated the course of economic downturn. This article analyses the impact of non-profit taxes on the overall tax burdens of companies. It offers not only a broad geographical scope but also great detail in calculations of tax burdens on income-independent taxes. In particular, it reveals that tax regimes characterized by restrictive thin capitalization rules, tightened loss offset rules, or a high proportion of non-profit taxes in the overall tax mix are more severely hit by economic downturns. The various tax measures taken by many EU-27 Member States in response to the crisis are, therefore, looked upon favourably.
Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW.Download this ZEW Discussion Paper from our ftp server:http://ftp.zew.de/pub/zew-docs/dp/dp12003.pdf Non-technical SummaryAmong the Member States of the European Union, Romania is considered to be a low tax country. This is mainly due to the fact that the Romanian corporate income tax rate of 16% currently undercuts the average corporate income tax rate in the Member States of the European Union by more than 6 percentage points. Yet, the corporate income tax rate does not give the whole picture as the reduction of corporate income tax rates in many longstanding EU and OECD Member States has in many cases been accompanied by a broadening of the tax base. Further important determinants of the tax burden of corporations that have been affected by tax reform measures implemented in the EU Member States comprise depreciation allowances, rules that restrict the deductibility of interest, and tax provisions that govern the treatment of losses.Hence, the objective of this paper is to firstly investigate the development of corporate tax law in Romania from 1992 to 2010 in order to highlight the main structural changes of the Romanian company tax system. Secondly, we want to investigate whether these changes are in line with the trend of tax-rate-cut-cum-base-broadening reforms, which has been identified for other Member States of the EU and the OECD.The descriptive analysis of the development of corporate taxation in Romania from 1992 to 2010 shows that the significant decrease of the corporate income tax rate from 45% in 1992 to 16% since 2005 has been accompanied by a great variety of reform measures pertaining to the tax base of corporate income tax. The most important changes concern the features of corporate tax systems already mentioned above, namely the depreciation allowances, provisions that restrict the deductibility of interest, and the treatment of losses.Overall, the decrease of the Romanian corporate income tax rate has not been accompanied by a broadening of the corporate income tax base. Compared to the year 1992, the rules currently governing the depreciation allowances for tax purposes, the treatment of dividends and the inter-temporal loss offset are more generous from the perspective of the tax payer. Hence, with respect to the overall picture, the development of corporate taxation in Romania does not fit in with the trend of tax-rate-cut-cum-base-broadening reforms.Our analysis of corporate taxation in Romania is not limited to a comprehensive descrip...
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