The Debt-Equity Tax Bias: consequences and solutions

The tax deductibility of interest payments in most corporate income tax systems coupled with no such measure for equity financing creates economic distortions and exacerbates leverage. This paper discusses the consequences of this debt bias and the possible remedies.

Debt vs Equity

EFB outlines the need to put equity on a level playing field with debt.

EFB Note on Debt Bias

This paper outlines the Institutional literature that has been published regarding the debt bias in taxation.

EFB Expert Group

EFB summarizes the European Commission’s Report of the Expert Group on Family Businesses.