Abstract
[Purpose]The purpose of this study is to investigate the influence of financial income comprehensive taxation changes on the corporate dividend policy.
[Methodology]In order to analyze the dividend policy of the shareholder’s tax burden due to the comprehensive taxation of financial income, the dividend size is divided into the total dividend (stock and cash dividend in the middle and the dividend) and the natural log value of the cash dividend Respectively. As the independent variable, it is defined as dummy variable indicating the base year discount rate. For the control variables, differentiated net profit, total asset growth rate, major shareholder ownership ratio and equity ratio are used.
[Findings]According to the results of the analysis, unlike the previous study, there was no phenomenon that the dividend size was reduced or increased statistically even if the dividend income tax burden of the shareholders increased due to the reduction of the standard amount of financial income comprehensive taxation. In particular, firms with high net income or large shareholders’ equity did not change dividend policy. This phenomenon means that even if the standard tariff is cut from KRW 40 million to KRW 20 million, even if additional tax burden of 4.8 million won is applied to the highest rate section applicant, it does not affect the dividend policy at the enterprise level.
[Implications]The results of this study do not affect the corporate dividend policy by lowering the standard amount of financial income taxation in 2013 and should consider the effect of the financial market such as corporate dividend policy when the financial income taxation system is revised Policy implications.
[Methodology]In order to analyze the dividend policy of the shareholder’s tax burden due to the comprehensive taxation of financial income, the dividend size is divided into the total dividend (stock and cash dividend in the middle and the dividend) and the natural log value of the cash dividend Respectively. As the independent variable, it is defined as dummy variable indicating the base year discount rate. For the control variables, differentiated net profit, total asset growth rate, major shareholder ownership ratio and equity ratio are used.
[Findings]According to the results of the analysis, unlike the previous study, there was no phenomenon that the dividend size was reduced or increased statistically even if the dividend income tax burden of the shareholders increased due to the reduction of the standard amount of financial income comprehensive taxation. In particular, firms with high net income or large shareholders’ equity did not change dividend policy. This phenomenon means that even if the standard tariff is cut from KRW 40 million to KRW 20 million, even if additional tax burden of 4.8 million won is applied to the highest rate section applicant, it does not affect the dividend policy at the enterprise level.
[Implications]The results of this study do not affect the corporate dividend policy by lowering the standard amount of financial income taxation in 2013 and should consider the effect of the financial market such as corporate dividend policy when the financial income taxation system is revised Policy implications.
| Translated title of the contribution | A Reduction in the Threshold of Comprehensive Taxation and Firm’s Dividend Policy |
|---|---|
| Original language | Korean |
| Pages (from-to) | 95-111 |
| Number of pages | 17 |
| Journal | 재무와 회계정보저널 |
| Volume | 17 |
| Issue number | 1 |
| State | Published - 2017 |