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Depreciation Provisions and Investment Incentives under Full Imputation

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  • MATT BENGE

Abstract

This paper examines how the Australian full imputation and capital gains tax provisions can combine to influence incentives to invest by affecting the cost of capital. Costs of capital for both unincorporated enterprises and widely held, Australian‐owned companies are examined under idealized depreciation provisions. The paper also presents numerical estimates of costs of capital under actual Australian depreciation provisions.

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  • Matt Benge, 1998. "Depreciation Provisions and Investment Incentives under Full Imputation," The Economic Record, The Economic Society of Australia, vol. 74(227), pages 329-345, December.
    • Handle: RePEc:bla:ecorec:v:74:y:1998:i:227:p:329-345
    DOI: 10.1111/j.1475-4932.1998.tb01929.x
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    Cited by:

    1. Richard Fabling & Norman Gemmell & Richard Kneller & Lynda Sanderson, 2013. "Estimating Firm-Level Effective Marginal Tax Rates and the User Cost of Capital in New Zealand," Working Papers 13_14, Motu Economic and Public Policy Research.
    2. John Creedy & Norman Gemmell, 2015. "Taxation and the User Cost of Capital: An Introduction," Treasury Working Paper Series 15/02, New Zealand Treasury.
    3. Marian Leimbach & Ottmar Edenhofer, 2005. "Capital Mobility and spillovers within a modular approach to multiregion modeling," Computing in Economics and Finance 2005 135, Society for Computational Economics.
    4. Kemfert, Claudia & Kremers, Hans, 2003. "A Computable General Equilibrium Assessment of a Developing Country Joining an Annex 1 Permit Trading Market," Conference papers 331095, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Fabling, Richard & Gemmell, Norman & Kneller, Richard & Sanderson, Lynda, 2013. "Estimating Firm-Level Effective Tax Rates and the User Cost of Capital in New Zealand," Working Paper Series 2854, Victoria University of Wellington, Chair in Public Finance.
    6. Benge, M., 1999. "The Ralph Report Depreciation Proposals and Investment Neutrality," ANU Working Papers in Economics and Econometrics 1999-371, Australian National University, College of Business and Economics, School of Economics.
    7. John C. Handley & Krishnan Maheswaran, 2008. "A Measure of the Efficacy of the Australian Imputation Tax System," The Economic Record, The Economic Society of Australia, vol. 84(264), pages 82-94, March.
    8. Ashley Winston, 2001. "Developing a Cost of Capital Module for Computable General Equilibrium Modelling," Centre of Policy Studies/IMPACT Centre Working Papers op-96, Victoria University, Centre of Policy Studies/IMPACT Centre.
    9. Fabling, Richard & Gemmell, Norman & Kneller, Richard & Sanderson, Lynda, 2013. "Estimating Firm-Level Effective Tax Rates and the User Cost of Capital in New Zealand," Working Paper Series 18787, Victoria University of Wellington, Chair in Public Finance.
    10. John Creedy & Norman Gemmell, 2015. "Taxation and the User Cost of Capital: An Introduction," Treasury Working Paper Series 15/02, New Zealand Treasury.

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