Skip to main content
SpringerLink
Log in

Tax and Corporate Governance: A Legal Approach

  • Conference paper
Tax and Corporate Governance

Part of the book series: MPI Studies on Intellectual Property, Competition and Tax Law ((MSIP,volume 3))

Abstract

The analysis of the basic legal framework where the interaction of tax and corporate governance takes place has to commence with the question of whether there exists any difference between the economic perspective presented in the preceding contribution by Mihir Desai and Dhammika Dharmapala1 and the legal perspective which is the topic of this chapter. In the old days, the distinction has been quite clear: the legal analysis would look at the law as it stands, the statutory and judge-made rules in the field of taxation, company law and financial markets from a normative standpoint, while the economic analysis would focus on the effects of such rules in mathematical models and the real world, trying to describe their impact on efficiency and distribution. Over the years, this distinction has become considerably blurred. Legal scholars employ the tools of economic analysis of law, capital market theory and information economics in corporate affairs2 as well as the findings of public finance and public choice in tax matters3 to discuss the current state of their field while economists use their theoretical and empirical findings in order to bring forward normative recommendations for legislation in different areas of the law.4 Lawyers still feel on their own when they engage in the interpretation and application of existing rules, but they have realized that they have to share the task of public policy recommendations with their economic brethren. It makes no sense any more to separate the theoretical, empirical and normative aspects of tax and corporate governance in this respect.

Major examples are the reform proposals for a “Consumption Tax” and the “Dual Income Tax” which build upon an extensive theoretical foundation.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 159.00
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 209.00
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 209.00
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. DESAI/ DHARMAPALA, Tax and Corporate Governance: An Economic Approach, in this volume, at 13.

    Google Scholar 

  2. Impressive examples are: CHEFFINS, Company Law — Theory, Structure and Operation (1997) (for the U.K.) and KRAAKMAN et al., The Anatomy of Corporate Law (2004) (for a comparative view).

    Google Scholar 

  3. See e.g. SCHÖN, Tax Competition in Europe — the Legal Perspective, 9 EC Tax Review 90 (2000).

    Article  Google Scholar 

  4. For further references see STANFORD ENCYCLOPEDIA OF PHILOSOPHY, Methodological Individualism, (first published February 3, 2005) (available at http://plato.stanford.edu/entries/methodological-individualism).

    Google Scholar 

  5. CHEFFINS, supra note 2, at 31 et seq.; EASTERBROOK/FISCHEL, The Economic Structure of Corporate Law, 1 et seq. (1991).

    Google Scholar 

  6. COASE, The Nature of the Firm, 4 Economica 386 (1937).

    Article  Google Scholar 

  7. See Art. 19 Para. 3 of the German Constitution (Basic Law): Legal Persons are awarded the same basic rights as natural persons insofar as the substance of these rights does not clash with the specificity of a legal person; in the most recent monography of taxpayers’ rights (BENTLEY, Taxpayers’ Rights: Theory, Origin and Implementation (2007)) the idea that individual and corporate taxpayers could be treated differently is not even mentioned.

    Google Scholar 

  8. TIROLE, The Theory of Corporate Finance, § 1.1, at 15 et seq. (2006).

    Google Scholar 

  9. OECD, Third Meeting of the OECD Forum on Tax Administration, September 14/15, 2006, Final, Seoul Declaration, para. (ii), at 4 (see www.oecd.org/dataoecd/38/29/37415572.pdf).

    Google Scholar 

  10. OECD, id., para. (ii), at 5.

    Google Scholar 

  11. HAZEN, The Law of Securities Regulation, Chapter 7 (5th ed. 2006).

    Google Scholar 

  12. The European Commission has put forward a proposal to introduce such liability (Communication from the Commission to the Council and the European Parliament: Modernising Company Law and Enhancing Corporate Governance in the European Union — A Plan to Move Forward, May 21, 2003, COM(2003) 284 final, § 3.1.1.; for German law see: FLEISCHER, Kapitalmarktrechtliche Informationshaftung gegenüber Dritten, in: FLEISCHER (ed.), Handbuch des Vorstandsrechts, § 14, notes 7 et seq. (2006).

    Google Scholar 

  13. OECD, The OECD Guidelines for Multinational Enterprises, 27 (revision 2000) (available at www.oecd.org/dataoecd/56/36/1922428.pdf); see also Annotations thereto, notes 60 et seq., at 54 et seq.; OECD Principles of Corporate Governance, Annotations, part VI, at 58 (2004) (available at www.oecd.org/dataoecd/32/18/31557724.pdf).

    Google Scholar 

  14. ALLEN, Our Schizophrenic Conception of the Business Corporation, 14 Cardozo L. Rev. 261, 264–276 (1992).

    Google Scholar 

  15. For a recent account of the “Corporate Social Responsibility” concept see: EPSTEIN, The Good Company: Rhetoric or Reality? Corporate Social Responsibility and Business Ethics Redux, 44 American Business Law Journal 207 (2007); FORT, The Times and Seasons of Corporate Responsibility, 44 American Business Law Journal 287 (2007).

    Article  Google Scholar 

  16. AVI-YONAH, Corporate Social Responsibility and Strategic Tax Behavior, in this volume, at 183.

    Google Scholar 

  17. The Ten Principles enshrined in the UN Global Compact for Responsible Corporate Citizenship look at Human Rights, Labour Standards, the Environment and Corruption but do not include any reference to taxation (see www.unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html); for a further analysis see DEVA, The UN Global Compact for Responsible Corporate Citizenship: Is it still Too Compact to be Global?, 2 Corporate Governance Law Review 145 (2006); moreover, the European Commission’s Green Paper — Promoting a European Framework for Corporate Social Responsibility (COM(2001) 366 final) does not specifically address any ethical obligations in the tax area; it only briefly mentions enterprises as contributors to the tax revenue of their local communities (at note 42).

    Google Scholar 

  18. See the contribution by HARTNETT, The Link between Taxation and Corporate Governance, in this volume, at 3.

    Google Scholar 

  19. RATHENAU, Vom Aktienwesen (1917); also available in RATHENAU, Gesammelte Schriften, Vol. 5, 121 et seq. (1917).

    Google Scholar 

  20. FLEISCHER, Leitungsaufgabe des Vorstands, in: FLEISCHER (ed.), Handbuch des Vorstandsrechts, § 1 para. 18 et seq. (2006).

    Google Scholar 

  21. § 2 ALI Corporate Governance Principles (1994).

    Google Scholar 

  22. DAVIES/ PRENTICE, Gower’s Principles of Modern Company Law, 69 (6th ed. 1997).

    Google Scholar 

  23. White Paper — Company Law Reform Bill, 2005, Chapter 1, at 1; for an in-depth analysis of the debate on the shareholder/stakeholder approach in the reform process see JOHNSTON, After the OFR: Can U.K. Shareholder Value still be Enlightened?, 7 European Business Law Review 817 (2006).

    Google Scholar 

  24. OECD Principles of Corporate Governance, supra note 15, Chapter VI.C.

    Google Scholar 

  25. JOHNSTON, supra note 26; FLEISCHER, supra note 23.

    Google Scholar 

  26. For the U.S. discussion see GEVURTZ, Corporation Law, 306 et seq. (2000); HANSMANN/KRAAKMAN, The End of History for Corporate Law, 89 Geo. L.J. 439, 447 et seq.; for the U.K. discussion see FERRAN, Company Law and Corporate Finance, 127 et seq. (1999); for a broad analysis of this problem see SABAPATHY, In the Dark all Cats are Grey: Corporate Responsibility and Legal Responsibility, in: TULLY (ed.), Research Handbook on Corporate Legal Responsibility, 235 et seq. (2005).

    Google Scholar 

  27. HEFERMEHL/ SPINDLER in: MÜNCHENER KOMMENTAR ZUM AKTIENGESETZ, Vol. 3, § 76, note 58 et seq. (2nd ed. 2004).

    Google Scholar 

  28. HANSMANN/ KRAAKMAN, The Essential Role of Organizational Law, 110 Yale Law Journal 387 (2000).

    Article  Google Scholar 

  29. BEBCHUK/ FRIED, The Uneasy Case for the Priority of Secured Claims in Bankruptcy, 105 Yale Law Journal 857, 881 et seq. (1996); ARMOUR, Legal Capital: An Outdated Concept, 7 European Business Organization Law Review 5, 10 et seq. (2006).

    Article  Google Scholar 

  30. Advocate General LA PERGOLA, Opinion of July 16, 1998, note 22, to decision of the ECJ, Case C-212/97 — Centros.

    Google Scholar 

  31. ECJ, Case C-212/97, March 9, 1999, note 37 — Centros; see also Advocate General ALBER, Opinion of January 30, 2003, note 150, to decision of the ECJ, Case C-167/01 — Inspire Art.

    Google Scholar 

  32. Bundesfinanzhof, January 21, 1972, 1972 BStBl. 364.

    Google Scholar 

  33. SCHÖN, GmbH-Geschäftsführerhaftung für Steuerschulden, in: GRUNEWALD et al. (eds.), Festschrift für Harm-Peter Westermann (forthcoming 2008).

    Google Scholar 

  34. §§ 6321 et seq. IRC; for an overview see NEWTON/LIQUERMAN, Bankruptcy and Insolvency Taxation, § 12.3. (3rd ed. 2005).

    Google Scholar 

  35. NEWTON/ LIQUERMAN, id., § 11.2.

    Google Scholar 

  36. DAVIES, Gower’s Principles of Modern Company Law, 827 (7th ed. 2003).

    Google Scholar 

  37. RAJAK, Company Liquidations, note 17-006 (2nd ed. 2006); TOLLEY’S TAXATION IN CORPORATE INSOLVENCY AND RESCUE, para. 2.1, 2.9. (5th ed. 2003).

    Google Scholar 

  38. MACEY, An Economic Analysis of the Various Rationales for Making Shareholders the Exclusive Beneficiaries of Corporate Fiduciary Duties, 21 Stetson L. Rev. 23 (1991).

    Google Scholar 

  39. FERRAN, supra note 29, at 137 et seq.; CHEFFINS, supra note 2, at 537 et seq.; GEVURTZ, supra note 29, § 4.1.a, at 306 et seq.; for an account and critique of the U.S. situation see HU/WESTBROOK, Abolition of the Corporate Duty to Creditors, 107 Columbia Law Review 132 (2007).

    Google Scholar 

  40. FERRAN, supra note 29, at 214 et seq.; CHEFFINS, supra note 2, at 542 et seq.

    Google Scholar 

  41. See Re Purpoint [1991] BCLC 491; the author expresses his gratitude to John Armour (Oxford) for helpful information on this point.

    Google Scholar 

  42. See Re Loquitur Limited [2003] EWHC 999 (Ch); the author expresses his gratitude to John Tiley (Cambridge) for helpful information on this point.

    Google Scholar 

  43. This has been decided in the context of social security contributions (Bundesgerichtshof, March 8, 1999, 1999 Neue Juristische Wochenschrift 2182 et seq.; Bundesgerichtshof, July 7, 2003, 2003 Zeitschrift für Wirtschaftsrecht (ZIP) 1713 et seq. with annotation by SCHMIDT; for a full account see SCHÖN, supra GmbH-Geschäftsführerhaftung für Steuerschulden, in: GRUNEWALD et al. (eds.), Festschrift für Harm-Peter Westermann (forthcoming 2008) note 36.

    Google Scholar 

  44. Sec. 6672 I.R.C.; see NEWTON/LIQUERMAN, supra note 37, at § 11.2 (f).

    Google Scholar 

  45. ALLSWORTH CHARTERED ACCOUNTANTS, Viewpoint — Directors Personal Liability for Corporate Taxes, June 2005.

    Google Scholar 

  46. SCHÖN, supra GmbH-Geschäftsführerhaftung für Steuerschulden, in: GRUNEWALD et al. (eds.), Festschrift für Harm-Peter Westermann (forthcoming 2008) note 36.

    Google Scholar 

  47. SCHÖN, GmbH-Geschäftsführerhaftung für Steuerschulden, in: GRUNEWALD et al. (eds.), Festschrift für Harm-Peter Westermann (forthcoming 2008) id.

    Google Scholar 

  48. HANSMANN/ KRAAKMAN, Toward Unlimited Shareholder Liability for Corporate Torts, 100 Yale Law Journal 1879 (1991).

    Article  Google Scholar 

  49. For a detailed proposal of shareholder-only taxation with respect to the company’s profits see DODGE, A Combined Mark-To-Market and Pass-Through Corporate Shareholder Integration Proposal, 50 Tax Law Review 265, 294 et seq. (1995).

    Google Scholar 

  50. For a critical assessment of the realization principle see SCHIZER, Realization as Subsidy, 73 New York University Law Review 1549 (1998); SCHENK, A Positive Account of the Realization Rule, 57 Tax Law Review 355 (2004).

    Google Scholar 

  51. SCHÖN, The Odd Couple: A Common Future for Financial and Tax Accounting?, 58 Tax Law Review 373 (2005).

    Google Scholar 

  52. AULT/ ARNOLD, Comparative Income Taxation — A Structural Analysis, 335 et seq. (2nd ed. 2004).

    Google Scholar 

  53. RAY, Partnership Taxation (Looseleaf), chapter 12 (2006).

    Google Scholar 

  54. SCHÖN, Bilanzkompetenzen und Ausschüttungsrechte in der Personengesellschaft, in: BUDDE et al. (eds.), Handelsbilanzen und Steuerbilanzen — Festschrift für Heinrich Beisse, 471, 487 et seq. (1997); ULMER, Gewinnanspruch und Thesaurierung in OHG und KG, in: SCHNEIDER et al. (eds.), Festschrift für Marcus Lutter, 935, 951 et seq. (2000).

    Google Scholar 

  55. Bundesgerichtshof, March 29, 1996, 132 Entscheidungen des Bundesgerichtshofs 263, 277 (1997).

    Google Scholar 

  56. For a full historical account see BANK, Is Double Taxation a Scapegoat for Declining Dividends? Evidence from History, 56 Tax Law Review 463 (2003).

    Google Scholar 

  57. AVI-YONAH, The Story of the Separate Income Tax: A Vehicle for Regulating Corporate Managers, in: BANK/STARK (eds.), Business Tax Stories, 11, 22 et seq. (2005).

    Google Scholar 

  58. BANK/ CHEFFINS, Tax and the Separation of Ownership and Control, in this volume, at 111.

    Google Scholar 

  59. FERRAN, supra note 29, at 154 et seq., 206 et seq.; FLEISCHER, Sorgfaltspflicht der Vorstandsmitglieder, in: FLEISCHER (ed.), Handbuch des Vorstandsrechts, § 7 (2006); HAMILTON/MACEY, Corporations, Including Partnerships and Limited Liability Companies, 670, 759 et seq. (9th ed. 2005).

    Google Scholar 

  60. This is part of the basic contractual relationship between shareholders and the management (if shareholders do not decide otherwise); EASTERBROOK/FISCHEL, supra note 6, at 35 et seq.

    Google Scholar 

  61. FRENCH/ RYAN, Mayson, French & Ryan on Company Law, para. 16.6.5 (24th ed. 2007–2008) on the most recent U.K. legislation (CA 2006 sec.172) that directors have to act for the “benefit of the members”.

    Google Scholar 

  62. SCHOLES/ WOLFSON/ ERICKSON/ MAYDEW/ SHEVLIN, Taxes and Business Strategy — A Planning Approach, § 1.2, at 5 et seq. (3rd ed. 2005); see also the contribution by ERLE, Tax Risk Management and Board Responsibility, in this volume, at 205; for an extensive analysis see GASSNER, Steuergestaltung als Vorstandspflicht, in: BERNAT et al. (eds.), Festschrift Heinz Krejci zum 60. Geburtstag, 605 et seq. (2001).

    Google Scholar 

  63. GASSNER, supra Steuergestaltung als Vorstandspflicht, in: BERNAT et al. (eds.), Festschrift Heinz Krejci zum 60. Geburtstag, (2001) note 68, at 610 et seq.; SLEMROD, The Economics of Corporate Tax Selfishness, 57 National Tax Journal 877 (2004).

    Google Scholar 

  64. SLEMROD, id., at 884.

    Google Scholar 

  65. FERRAN, supra note 29, at 250 et seq. (U.K.); GEVURTZ, supra note 29, § 3.1.3, at 195 et seq. (U.S.); FLEISCHER, supra note 23, § 1 para. 51.

    Google Scholar 

  66. FERRAN, supra note 29, at 87 et seq.

    Google Scholar 

  67. See e.g. § 3.02 Revised Model Business Corporation Act and §§ 122, 123 Delaware General Corporation Law; for an account of the “decline” of the ultra vires doctrine see GEVURTZ, supra note 29, § 3.1.4, at 220 et seq.; HAMILTON/MACEY, supra note 65, ch.6 sec.C, at 223 et seq.

    Google Scholar 

  68. FLEISCHER, supra Leitungsaufgabe des Vorstands, in: FLEISCHER (ed.), Handbuch des Vorstandsrechts (2006) note 23, § 1 para. 51.

    Google Scholar 

  69. As to the economic importance of control rights for different investors see TIROLE, supra note 9, § 10, at 387 et seq.

    Google Scholar 

  70. EASTERBROOK/ FISCHEL, supra note 6, at 35 et seq.

    Google Scholar 

  71. GASSNER, supra Steuergestaltung als Vorstandspflicht, in: BERNAT et al. (eds.), Festschrift Heinz Krejci zum 60. Geburtstag, (2001) note 68, at 620 et seq.

    Google Scholar 

  72. GEVURTZ, supra note 29, § 4.1.2, at 278 et seq.; FLEISCHER, supra note 65, § 7 para. 45 et seq.

    Google Scholar 

  73. SLEMROD, supra note 69, at 885.

    Google Scholar 

  74. OECD, Seoul Declaration, supra note 10.

    Google Scholar 

  75. See (among others) ELGOOD, What is Tax Risk?, 31 Tax Planning International Review 3 (2004/6); HICKEY, Tax Risk Management — The Tolerance Factor, 44 Tax Notes International 609 (2006); LAW, Tax Risk Management: The Evolving Role of Tax Directors, 32 Tax Planning International Review 9 (2005/2).

    Google Scholar 

  76. ERLE, supra note 68.

    Google Scholar 

  77. BEALE, Putting SEC Heat on Audit Firms and Corporate Tax Shelters: Responding to Tax Risk with Sunshine, Shame and Strict Liability, 29 Journal of Corporation Law 219 (2004).

    Google Scholar 

  78. For an in-depth analysis see PALMES, Der Lagebericht — Grundfragen und Haftung (forthcoming 2008).

    Google Scholar 

  79. LAFON, FASB, IASB address FIN 48 Measurements, 46 Tax Notes International 550 (2007).

    Google Scholar 

  80. CIGLER, FIN 48 challenges for International Operations, 18 Journal of International Taxation 64 (2007); JAWORSKI/CODER, Panel Debates Effect of FIN 48 on Transparency, Compliance, 116 Tax Notes 237 (2007); NICHOLS/BARIL/BRIGGS, Early Indications of the Impact of FIN 48, 116 Tax Notes 119 (2007); NICHOLS/BRIGGS/BARIL, And the Impact is... First Quarter Results from Adopting FIN 48, 116 Tax Notes 377 (2007); RUSSO/MOERER, Are You “Fin 48” Ready?, 8 Tax Planning International Transfer Pricing 20 (2007/5); WEBER/GETZ, Accounting for Uncertainty in Income Taxes: A Practical Approach for Adoption, 33 Tax Planning International Review 6 (2006/9).

    Google Scholar 

  81. STAMPER, Increased Transparency Still Falling Short, Everson Says, 114 Tax Notes 502 (2007).

    Google Scholar 

  82. CODER, IRS Considering Changing Policy on FIN 48 Workpapers, 115 Tax Notes 1113 (2007); STRATTON, FIN 48 Leading IRS to Reconsider Restraint Policy for Workpapers, 114 Tax Notes 614 (2007).

    Google Scholar 

  83. IASB, Management Commentary — Discussion Paper, para. 119 (October 2005).

    Google Scholar 

  84. SCHÖN, Finanzbeamte auf den Finanzmarkt?, 171 Zeitschrift für das Gesamte Handels-und Wirtschaftsrecht 485 (2007).

    Google Scholar 

  85. As to the economics of tax evasion see ALLINGHAM/SANDMO, Income Tax Evasion: A Theoretical Analysis, 1 Journal of Public Economics 323 (1972); SANDMO, The Theory of Tax Evasion: A Retrospective View, 58 National Tax Journal 643 (2005); for a more comprehensive view, including the concept of “fairness”, “morale” and “religion” see TORGLER, Tax Compliance and Tax Morale, passim (2007).

    Article  Google Scholar 

  86. EASTERBROOK/ FISCHEL, Antitrust Suits by Targets of Tender Offers, 80 Michigan Law Review 1155, 1168 (1983); GEVURTZ, supra note 29, § 4.1.6, at 313.

    Article  Google Scholar 

  87. GASSNER, supra Steuergestaltung als Vorstandspflicht, in: BERNAT et al.(eds.), Festschrift Heinz Krejci zum 60. Geburtstag, (2001) note 68, at 620; the current debate in the U.S. is laid out in WILLIAMS, Corporate Compliance with the Law in the Era of Efficiency, 76 North Carolina Law Review 1265 (1998); a broad comparative account and an analysis under German law is supplied by FLEISCHER, Aktienrechtliche Legalitätspflicht und “nützliche” Pflichtverletzungen von Vorstandsmitgliedern, 26 Zeitschrift für Wirtschaftrecht 141 (2005).

    Google Scholar 

  88. For an economic analysis see COOTER, Prices and Sanctions, 84 Columbia Law Review 1523 (1984).

    Article  Google Scholar 

  89. EISENBERG, Corporate Conduct that does not Maximise Shareholder Gain: Legal Conduct, Ethical Conduct, The Penumbra Effect, Reciprocity, the Prisoner’s Dilemma, Sheep’s Clothing, Social Conduct, and Disclosure, 28 Stetson L.Rev. 1, 3 et seq. (1998).

    Google Scholar 

  90. CROCKER/ SLEMROD, Corporate Tax Evasion with Agency Costs, 89 Journal of Public Economics 1593 (2005); SLEMROD, supra note 69, at 885; see also SANDMO, supra note 92, at 655; for an analysis of the interdependence of personal tax evasion by a manager and his involvement in corporate tax evasion see GOERKE, Corporate and Personal Income Tax Declarations, International Tax and Public Finance 281 (2007).

    Article  Google Scholar 

  91. NADAL/ PARILLO, Socially Responsible Taxation — Much Ado about Nothing?, 47 Tax Notes International 791 (2007).

    Google Scholar 

  92. SHAVIRO, Disclosure and Civil Penalty Rules in the U.S. Legal Response to Corporate Tax Shelters, in this volume, at 229.

    Google Scholar 

  93. KORB, Shelters, Schemes, and Abusive Transactions: Why Today’s Thoughtful U.S. Tax Advisors Should Tell Their Clients to “Just Say No”, in this volume, at 289.

    Google Scholar 

  94. DESMOND, Opinion Standards for Tax Practitioners Under U.S. Department of the Treasury Circular 230, in this volume, at 265.

    Google Scholar 

  95. SAVINA, Changing the Calculus: Making Tax Shelters Unprofitable, 58 National Tax Journal 471 (2005).

    Google Scholar 

  96. For an in-depth-analysis see the Articles and Comments from the Symposium “Futures of Tax Shelters” of Minnesota Law School (October2006), 26 Virginia Tax Review 769 (2007).

    Google Scholar 

  97. For an empirical assessment of these effects see HANLON/SLEMROD, What does Tax Aggressiveness Signal? Evidence from Stock Price Reactions to News about Tax Aggressiveness, Working Paper, University of Michigan (2007).

    Google Scholar 

  98. OECD Principles of Corporate Governance, supra note 15, Annotations, part VI.C.

    Google Scholar 

  99. GASSNER, supra Steuergestaltung als Vorstandspflicht, in: BERNAT et al.(eds.), Festschrift Heinz Krejci zum 60. Geburtstag, (2001) note 68, at 605 et seq.; SLEMROD, supra note 69, at 884.

    Google Scholar 

  100. Bundesgerichtshof, December 6, 2001, 2002 Neue Juristische Wochenschrift 1585 et seq.; for a comparative view see FLEISCHER, Unternehmensspenden und Leitungsermessen des Vorstands im Aktienrecht, 46 Aktiengesellschaft 171 (2001).

    Google Scholar 

  101. FERRAN, supra note 29, at 127 et seq.

    Google Scholar 

  102. HAMILTON/ MACEY, supra note 65, at 546 et seq.

    Google Scholar 

  103. For a case-by-case analysis of such non-business rationales see EISENBERG, supra note 96, at 1 et seq.

    Google Scholar 

  104. GASSNER, supra Steuergestaltung als Vorstandspflicht, in: BERNAT et al.(eds.), Festschrift Heinz Krejci zum 60. Geburtstag, (2001) note 68, at 623.

    Google Scholar 

  105. EISENBERG, supra note 96, at 5.

    Google Scholar 

  106. FREEDMAN, Defining Taxpayer Responsibility: In Support of a General Anti-Avoidance Principle, 2004 British Tax Review 332, 336 et seq.

    Google Scholar 

  107. SLEMROD, supra note 69, at 884.

    Google Scholar 

  108. JOINT COMMITTEE ON TAXATION, 108th Congress Report of Investigation of Enron Corporation and Related Entities Regarding Federal Tax and Compensation Issues and Policy Recommendations (Comm. Print 2003).

    Google Scholar 

  109. For an economic analysis of this point see DESAI/DHARMAPALA, supra note 1.

    Google Scholar 

  110. For a comparative view see PAEFGEN, “Holzmüller” und der Rechtsschutz des Aktionärs gegen das Verwaltungshandeln im Rechtsvergleich, 171 Zeitschrift für das Gesamte Handelsund Wirtschaftsrecht (forthcoming 2008).

    Google Scholar 

  111. The most recent U.S. case on this is Hollinger Inc. v. Hollinger International Inc., 858 A.2d 342 (Del. Ch., 2004).

    Google Scholar 

  112. FRENCH/ RYAN, supra note 67, para. 15.10.6.

    Google Scholar 

  113. Bundesgerichtshof, February 25, 1982, 83 Entscheidungen des Bundesgerichtshofs 122 et seq. (1982) — Holzmüller; Bundesgerichtshof, April 26, 2004, 159 Entscheidungen des Bundesgerichtshofs 30 et seq. (2004) — Gelatine.

    Google Scholar 

  114. CHAN/ LO/ MO, Managerial Autonomy and Tax Compliance: An Empirical Study on International Transfer Pricing, 28 The Journal of the American Taxation Association 1 (2006).

    Google Scholar 

  115. SCHÖN, supra note 56.

    Google Scholar 

  116. The most recent comprehensive economic analysis of the effect of book and tax rules on real investment decisions is presented by SHACKELFORD/ SLEMROD/SALLEE, A Unifying Model of How the Tax System and Generally Accepted Accounting Principles Affect Corporate Behavior, Working Paper (2007) (available at http://ssrn.com/abstract=958436).

    Google Scholar 

  117. SCHOLES et al., supra note 68, at 81 et seq.; SCHREIBER, Besteuerung der Unternehmen, 493 et seq. (2005).

    Google Scholar 

  118. DAUCHY, Do Tax Considerations Still Matter in Firms’ Choice of Organizational Form? in: National Tax Association, Proceedings of the 98th Annual Conference 2005, 495 et seq. (2006)

    Google Scholar 

  119. See FRIESE/LINK/MAYER, Taxation and Corporate Governance — The State of the Art, in this volume, at 357.

    Google Scholar 

  120. ROE, Delaware’s Competition, 117 Harvard Law Review 588 (2003).

    Article  Google Scholar 

  121. BANK, Tax, Corporate Governance, and Norms, 61 Washington and Lee Law Review 1159, 1232 (2004).

    Google Scholar 

  122. DESAI/ DYCK/ ZINGALES, Theft and Taxes, 85 Journal of Financial Economics 591, 618 (2007); AVI-YONAH, supra note 18, at 18.

    Article  Google Scholar 

  123. Landgericht Karlsruhe, July 26, 2005, 58 Neue Juristische Wochenschrift 2625 et seq. (2005).

    Google Scholar 

  124. Oberlandesgericht Karlsruhe, October 15, 2007, Börsen-Zeitung of October 16, 2007, 6.

    Google Scholar 

  125. SCHULZE-OSTERLOH, Die Abzugsbeschränkung für Aufsichtsratsvergütungen, das Kon-TraG und die Widerspruchsfreiheit der Rechtsordnung, in: KIRCHHOF et al. (eds.), Steuerrechtsprechung, Steuergesetz, Steuerreform: Festschrift für Klaus Offerhaus, 375 et seq. (1999).

    Google Scholar 

  126. On the value of increased cooperation among economists and lawyers see GENTRY, The Future of Tax Research: A Mostly Economics Perspective, 29 Journal of the American Taxation Association 95 (2007).

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Accounting and Taxation, Max Planck Institute for Intellectual Property, Competition and Tax Law, Munich

    Wolfgang Schön (Director)

Authors
  1. Wolfgang Schön
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. Max Planck Institute for Intellectual Property, Competition and Tax Law, Marstallplatz 1, 80539, Munich, Germany

    Wolfgang Schön

Rights and permissions

Reprints and permissions

Copyright information

© 2008 Springer-Verlag Berlin Heidelberg

About this paper

Cite this paper

Schön, W. (2008). Tax and Corporate Governance: A Legal Approach. In: Schön, W. (eds) Tax and Corporate Governance. MPI Studies on Intellectual Property, Competition and Tax Law, vol 3. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-77276-7_4

Download citation

Publish with us

Policies and ethics

Search

Navigation