Trade credit and taxes

• Autores: Mihir A. Desai, C. Fritz Foley, James R. Hines Jr.
• Localización: The Review of economics and statistics, ISSN 0034-6535, Vol. 98, Nº 1, 2016, págs. 132-139
• Idioma: inglés
• DOI: 10.1162/rest_a_00534
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• Resumen

  • This paper analyzes the extent to which tax differences affect the use of trade credit. U.S.-owned affiliates in low-tax countries use trade credit to lend, whereas those in high-tax countries use trade credit to borrow: 10% lower local tax rates are associated with net trade credit positions that are 1.4% higher as a fraction of sales. The use of trade credit to get capital out of low-tax, low-return environments is also illustrated by the temporary repatriation tax holiday in 2005, which was used most intensively by affiliates with positive net trade credit positions