Tax Asymmetries and Corporate Income Tax Reform

摘要: This paper investigates the impact of tax asymmetries (the lack full loss offsets) under current corporate income law and a stylized reform proposal. The government's claim on firm's pretax cash flows is modelled as series path-dependent call options valued by option pricing procedures Monte Carlo simulation.The investigated reduces statutory rate, eliminates investment credit sets depreciation approximately equal to economic depreciation. These changes would increase effective rate marginal investments firms that always pay taxes, but dramatically reduce potential burden asymmetries. "Stand-alone" investments, which are exposed greatest burden, uniformly more valuable this reform, despite accelerated depreciation.These general results backed up numerical experiments. We vary risk, inflation (with without indexing depreciation), investigate how allowing interest carry forwards affect after-tax project value.