Impact of Tax Burden on the Capital Structure of Brazilian Companies
DOI:
https://doi.org/10.16930/2237-766220253622Keywords:
Tax Burden, Capital Structure, Trade-Off, Pecking-OrderAbstract
This study investigates the relationship between tax burden and corporate indebtedness in Brazilian companies, testing three hypotheses: first, whether the tax burden positively influences the level of overall indebtedness; second, whether it influences short-term debt; and third, whether it influences long-term debt. The analysis uses accounting data from 161 publicly traded companies across various sectors, covering the period from the fourth quarter of 2010 to the fourth quarter of 2023. totaling 8.533 observations extracted from the open data portal of the Brazilian Securities and Exchange Commission (CVM). To test the hypotheses, generalized linear models were estimated, considering overall debt (OD), short-term debt (STD), and long-term debt (LTD) as dependent variables. The tax burden (TB) was used as the explanatory variable, along with a set of control variables: profitability, current liquidity, asset turnover, firm size, economic crisis, Selic rate, GDP, and IPCA. The results indicate that the tax burden has a positive and significant relationship with all debt metrics, confirming the formulated hypotheses. Moreover, robustness tests did not indicate endogeneity, reinforcing the reliability of the findings. These results suggest that the tax burden plays a relevant role in the capital structure of Brazilian companies, providing empirical support for the Trade-Off theory.
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