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Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes

There is a body of received theories which suggest that tax policy changes actually influence the value of corporations, and affect capital market values. There is strong evidence of share price being changed whenever good or bad news from tax changes occur. This paper provides a very short review o...

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Main Authors: Selamat, Aslam, Syed Mohamed, Mohamed Ariff, Ramadilli Mohd, Shamsher Mohamad
Format: Article
Language:English
Published: Universiti Putra Malaysia Press 2012
Online Access:http://psasir.upm.edu.my/id/eprint/37137/1/17_Page%201209-1228.pdf
http://psasir.upm.edu.my/id/eprint/37137/
http://www.pertanika.upm.edu.my/Pertanika%20PAPERS/JSSH%20Vol.%2020%20(4)%20Dec.%202012/17_Page%201209-1228.pdf
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spelling my.upm.eprints.371372015-09-14T10:36:19Z http://psasir.upm.edu.my/id/eprint/37137/ Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes Selamat, Aslam Syed Mohamed, Mohamed Ariff Ramadilli Mohd, Shamsher Mohamad There is a body of received theories which suggest that tax policy changes actually influence the value of corporations, and affect capital market values. There is strong evidence of share price being changed whenever good or bad news from tax changes occur. This paper provides a very short review of well-known theories, with the aim of showing how tax changes relating to dividends in Malaysia and in the USA do actually affect the values of shares in one mid-income and one high-income economy. Malaysia's policy change in 2007 to streamline the dividend credit system into a single-tier tax system led to share price increases in Bursa Malaysia. Tax effect in the USA was tested using the good news of dividend tax cuts passed into law on three dates over 2003 and 2010. These findings are very much policy relevant for the ongoing debate, for example, in Malaysia on introducing future goods and sales tax to reduce other taxes. Universiti Putra Malaysia Press 2012-12 Article PeerReviewed application/pdf en http://psasir.upm.edu.my/id/eprint/37137/1/17_Page%201209-1228.pdf Selamat, Aslam and Syed Mohamed, Mohamed Ariff and Ramadilli Mohd, Shamsher Mohamad (2012) Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes. Pertanika Journal of Social Sciences & Humanities, 20 (4). pp. 1209-1228. ISSN 0128-7702; ESSN: 2231-8534 http://www.pertanika.upm.edu.my/Pertanika%20PAPERS/JSSH%20Vol.%2020%20(4)%20Dec.%202012/17_Page%201209-1228.pdf
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description There is a body of received theories which suggest that tax policy changes actually influence the value of corporations, and affect capital market values. There is strong evidence of share price being changed whenever good or bad news from tax changes occur. This paper provides a very short review of well-known theories, with the aim of showing how tax changes relating to dividends in Malaysia and in the USA do actually affect the values of shares in one mid-income and one high-income economy. Malaysia's policy change in 2007 to streamline the dividend credit system into a single-tier tax system led to share price increases in Bursa Malaysia. Tax effect in the USA was tested using the good news of dividend tax cuts passed into law on three dates over 2003 and 2010. These findings are very much policy relevant for the ongoing debate, for example, in Malaysia on introducing future goods and sales tax to reduce other taxes.
format Article
author Selamat, Aslam
Syed Mohamed, Mohamed Ariff
Ramadilli Mohd, Shamsher Mohamad
spellingShingle Selamat, Aslam
Syed Mohamed, Mohamed Ariff
Ramadilli Mohd, Shamsher Mohamad
Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
author_facet Selamat, Aslam
Syed Mohamed, Mohamed Ariff
Ramadilli Mohd, Shamsher Mohamad
author_sort Selamat, Aslam
title Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
title_short Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
title_full Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
title_fullStr Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
title_full_unstemmed Dividend tax cuts in the United States and single-tier tax regime in Malaysia: share price reactions to tax policy changes
title_sort dividend tax cuts in the united states and single-tier tax regime in malaysia: share price reactions to tax policy changes
publisher Universiti Putra Malaysia Press
publishDate 2012
url http://psasir.upm.edu.my/id/eprint/37137/1/17_Page%201209-1228.pdf
http://psasir.upm.edu.my/id/eprint/37137/
http://www.pertanika.upm.edu.my/Pertanika%20PAPERS/JSSH%20Vol.%2020%20(4)%20Dec.%202012/17_Page%201209-1228.pdf
_version_ 1643831917554958336
score 13.211869

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