No. 76: The Big Short (Interest): Closing the Loopholes in the Dividend-Withholding Tax

Jahr: 2023

Typ: Working Paper

Open Science:

Bronze

Abstract

We study the effect of stricter enforcement of the dividend-withholding tax (DWT). We focus on a 2016 Danish enforcement reform and compare Denmark to its Nordic neighbors. Throughout Nordic stock markets, shares on loan spike sharply around dividend dates. These spikes are consistent with so-called cum-cum and cum-ex trading. Post reform, spikes in Denmark disappear, and annual DWT revenue increases by 130 percent. Enforcement does not harm the investment climate, as measured by Danish stock returns, investment rate, and dividend yield.

Veröffentlichungsinformationen

TRR 266 researchers

Elisa Casi-Eberhard Norwegian School of Economics

External researchers

Evelina Gavrilova

David Murphy

Floris Zoutman

DOI

DOI Link

Open Science

To cite this article

Casi-Eberhard, E., Gavrilova, E., Murphy, D., & Zoutman, F. (2023). The Big Short (Interest): Closing the Loopholes in the Dividend-Withholding Tax. TRR 266 Accounting for Transparency Working Paper Series No. 76. https://dx.doi.org/10.2139/ssrn.4039744

Zugehörige Projekte

B07

Costs and Benefits of Tax Transparency

+ 10

Beteiligte Institutionen

Die Hauptstandorte vom TRR 266 sind die Universität Paderborn (Sprecherhochschule), die HU Berlin und die Universität Mannheim. Alle drei Standorte sind seit vielen Jahren Zentren für Rechnungswesen- und Steuerforschung. Hinzu kommen Wissenschaftler der LMU München, der Frankfurt School of Finance and Management, der Goethe-Universität Frankfurt, der Universität zu Köln und der Leibniz Universität Hannover, die die gleiche Forschungsagenda verfolgen.