Download or read book The Impact of Personal Income Taxation on Executive Compensation written by Peter Katuscak and published by . This book was released on 2005 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes the effect of personal income taxation on the sensitivity of executive compensation to company performance and the use of stock option and restricted stock grants underlying this sensitivity. The theoretical model predicts that, if a single tax rate applies to the entire compensation package, an increase in the tax rate weakly diminishes the equilibrium level of managerial effort and the after-tax pay-to-performance sensitivity, with the effect on the pre-tax pay-to-performance sensitivity being ambiguous. When salary and option gains are taxed at a higher rate than stock gains, tax changes also induce shifting among the individual compensation instruments. Interestingly, this differential taxation leads to a positive amount of stocks in the compensation contract even in the absence of any desire to incentivize the manager. In addition, an increase in the tax rate applied to salary and option gains may increase the level of managerial effort in equilibrium. On the other hand, an increase in the tax rate applied to stock gains weakly decreases the equilibrium level of managerial effort and strictly decreases the amount of after-tax pay-to-performance sensitivity generated by stock grants. The second part of the paper exploits the variation in the U.S. federal personal income tax rate generated by the Omnibus Budget Reconciliation Act of 1993, as well as variation in the combined federal and state income tax rates during the period 1992-1996 to empirically evaluate the impact of personal income taxation on the pay-to-stock-price sensitivity generated by stock-option and restricted stock grants. The results show that an increase in the ordinary income tax rate decreases the pay-to-stock-price sensitivity generated by option grants when time series variation in the marginal tax rate is utilized in the identification, with the estimates retaining the same sign but being statistically insignificant when only the variation in the marginal tax rate originating from cross-sectional variation in the federal income tax rate and/or state tax rate changes is used in the estimation. On the other hand, stock grant sensitivity is found to be unresponsive to changes in the ordinary income tax rate.
Download or read book Effects of Taxation written by Challis A. Hall and published by . This book was released on 1951 with total page 410 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Effect of Tax Policy on Executive and Worker Compensation written by Tax Institute and published by . This book was released on 1958 with total page 92 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Impact of Taxation on Management Responsibility written by Tax Institute of America and published by . This book was released on 1957 with total page 84 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Effects of Taxation written by Thomas Henry Sanders and published by . This book was released on 1951 with total page 256 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Theoretical and Empirical Effects of Income Taxation on Chief Executive Compensation written by Michael Ross Ericksen and published by . This book was released on 1979 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Executive Compensation a Total Pay Perspective written by Bruce R. Ellig and published by McGraw-Hill Companies. This book was released on 1982 with total page 360 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Taxes High income Executives and the Perils of Revenue Estimation in the New Economy written by Austan Goolsbee and published by . This book was released on 1999 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper attempts to help explain the unforecasted, excess' personal income tax revenues of the last several years. Using panel data on executive compensation in the 1990s, it argues that because the gains on most stock options are treated as ordinary income for tax purposes, rising stock market valuations are directly tied to non-capital gains income. This blurred line between capital and wage income for has affected tax revenue in three ways, at least for these high-income people. First, stock performance has directly affected the amount of ordinary income that people report by influencing their stock option exercise decisions. Second, the presence of options gives executives more flexibility in changing the timing of their reported income and appears to make them much more sensitive to the short-run timing of tax changes, even accounting for the stock market changes of the period. Third, because of the tax rules on options, changing the capital gains tax rate, as the U.S. did in the late 1990s, can lead individuals to exercise their options early to convert the expected future gains into lower-taxed forms. The data show significant evidence of each of these effects and in all three cases, executives working in the new' economy and high-technology sectors.
Download or read book Tax Impacts on Compensation written by Daniel Mark Holland and published by . This book was released on 1969 with total page 232 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Methods to Minimize the Impact of Federal Income Taxes on Executive Compensation written by Joseph Anthony Giuffre and published by . This book was released on 1959 with total page 248 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Adjusting Executive Pay for Inflation written by J. Frank Gaston and published by . This book was released on 1982 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Regulating Executive Pay written by Nancy L. Rose and published by . This book was released on 1999 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper considers the effects of the 1993 legislation limiting the deductibility of non-performance-based executive compensation for corporate income tax purposes. We begin by describing the specific provisions of the legislation, and we discuss its possible effects on overall compensation levels and the relative importance of different components of compensation. Our empirical analysis focuses first on modeling firms' decisions about how to comply with the law. We then present results on the effects of the tax cap on compensation. Generally, we find that firms affected by the law are increasing salary more slowly than non-affected firms, thought performance-related components of compensation continue to grow. In fact, we find that firms that qualified their stock plan as performance-based have increased non-cash compensation more than other firms. That finding may suggest that boards designate very high potential stock awards as performance-based to exempt them from the deductibility limitation and then fail to withhold all or part of the award.
Download or read book The Response of Deferred Executive Compensation to Changes in Tax Rates written by Aspen Gorry and published by . This book was released on 2015 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Given the increasing use of stock options in executive compensation, we examine how taxes influence the choice of compensation and document that income deferral is an important margin of adjustment in response to tax rate changes. To account for this option in the empirical analysis, we explore deferral by estimating how executives' choice of compensation between current and deferred income depends on changes in tax policy. Our empirical results suggest a significant impact of taxes on the composition of executive compensation.
Download or read book Pay Without Performance written by Lucian A. Bebchuk and published by Harvard University Press. This book was released on 2004 with total page 308 pages. Available in PDF, EPUB and Kindle. Book excerpt: The company is under-performing, its share price is trailing, and the CEO gets...a multi-million-dollar raise. This story is familiar, for good reason: as this book clearly demonstrates, structural flaws in corporate governance have produced widespread distortions in executive pay. Pay without Performance presents a disconcerting portrait of managers' influence over their own pay--and of a governance system that must fundamentally change if firms are to be managed in the interest of shareholders. Lucian Bebchuk and Jesse Fried demonstrate that corporate boards have persistently failed to negotiate at arm's length with the executives they are meant to oversee. They give a richly detailed account of how pay practices--from option plans to retirement benefits--have decoupled compensation from performance and have camouflaged both the amount and performance-insensitivity of pay. Executives' unwonted influence over their compensation has hurt shareholders by increasing pay levels and, even more importantly, by leading to practices that dilute and distort managers' incentives. This book identifies basic problems with our current reliance on boards as guardians of shareholder interests. And the solution, the authors argue, is not merely to make these boards more independent of executives as recent reforms attempt to do. Rather, boards should also be made more dependent on shareholders by eliminating the arrangements that entrench directors and insulate them from their shareholders. A powerful critique of executive compensation and corporate governance, Pay without Performance points the way to restoring corporate integrity and improving corporate performance.
Download or read book Executive Compensation written by Steven Balsam and published by Worldatwork. This book was released on 2007 with total page 556 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Taxing Wages 2021 written by OECD and published by OECD Publishing. This book was released on 2021-04-29 with total page 651 pages. Available in PDF, EPUB and Kindle. Book excerpt: This annual publication provides details of taxes paid on wages in OECD countries. It covers personal income taxes and social security contributions paid by employees, social security contributions and payroll taxes paid by employers, and cash benefits received by workers. Taxing Wages 2021 includes a special feature entitled: “Impact of COVID-19 on the Tax Wedge in OECD Countries”.
Download or read book Understanding the tax reform debate background criteria questions written by and published by DIANE Publishing. This book was released on 2005 with total page 77 pages. Available in PDF, EPUB and Kindle. Book excerpt:
