Derek Spratley, John Pointon and Sue Farrar
In this paper we report on three research projects relating to investment in Europe.
John Pointon and Derek Spratley
An empirical survey, of 136 respondents from UK quoted companies, was conducted with regard to the likely effects of UK corporation tax reform on share buy‐backs, capital…
Abstract
An empirical survey, of 136 respondents from UK quoted companies, was conducted with regard to the likely effects of UK corporation tax reform on share buy‐backs, capital investment and financing choices. Overall, 45 per cent expected ACT abolition to lead to an increase in share buy‐backs. Logistic regression analysis links this view to corporate liquidity. The abolition of advance corporation tax is, however, unlikely to have a significant impact upon UK and overseas capital investment, bond issues, bond redemptions, share issues, finance leasing and projected dividend levels. Capital investment and financing choices are likely to be invariant to the combined effects of a reduced corporate tax rate and a quarterly collection period.