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Corporate Debt Bias: Reasons and Possible Solutions

  • Güneş Topçu
Conference paper
Part of the Springer Proceedings in Business and Economics book series (SPBE)

Abstract

This paper examines the asymmetric taxation of debt and equity and its consequences on the capital structure of companies and the economy as a whole. Policy options, the main ones of which include the restriction or elimination of interest deductibility and the allowance for corporate equity, are proposed as solutions to the corporate debt bias. Country-specific examples of the implementation of policy options to eliminate the tax bias on debt financing are presented. Moreover, information on the availability of tax incentives for the encouragement of equity financing in Turkey is given.

Keywords

Corporate debt bias Capital structure Allowance for equity Corporate income tax 

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Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.Çanakkale Onsekiz Mart UniversityÇanakkaleTurkey

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