Publicações Académicas J-P-E

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Percorrer Publicações Académicas J-P-E por autor "Martins, António"

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    Complexity in the tax law and reported earnings: cost deduction in the Portuguese fiscal system
    (2003) Martins, António
    Purpose – The purpose of this paper is the analysis of some important clauses inserted in the Portuguese corporate income tax (CIT) code and how they can be a source of divergence between reported earnings and taxable income. Additionally, the paper also discusses if these clauses are a source of management flexibility in reporting earnings, even if it means paying higher taxes. Design/methodology/approach – The approach taken in this paper is based on a branch of legal research methodology. The paper uses applied legal research, exploring two avenues. One is based on the recognition that it is usually not possible to arrive at the correct interpretation of the law only by pure deductive reasoning, because hard cases' outcomes tend to form a body of jurisprudence that affects the application of legal rules. Verbal interpretation and manipulation of law usually give rise to contradictory outcomes from apparently identical situations. The approach is also based on macro tax data, in order to present some empirical evidence of hypothesized management behavior. Findings – The paper finds that ambiguity in CIT laws induces a type of management behaviour characterised by minimizing tax liabilities estimates. Portuguese corporate tax returns show an improbable low level of adjustments related to clauses where flexibility in the timing of cost deduction is an option. Originality/value – The paper adds to the body of literature that analyses the relation between the level of ambiguity and uncertainty in tax laws and its impact on managers' decisions, particularly about reported income, and presents some supportive evidence of the hypothesized behaviour. It is useful for managers, tax authorities and tax courts, by discussing the relation between the nature of tax clauses and management behaviour.
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    As receitas da Sisa em 2003: uma estimativa da sua evolução conjuntural e do impacto do anúncio das mudanças legislativas
    (2003) Martins, António; Fortes, Nuno
    Este artigo apresenta uma estimativa da evolução previsível das receitas da sisa em 2003 no pressuposto da não existências de alterações legislativas que modificassem o referido imposto. Usando modelos estatisticos simples que explicam a variação da sisa em função de outras variáveis económicas, confronta-se depois o resultado obtido para o ano de 2003 com a evolução da cobrança durante o primeiro semestre, concluindo que o anúncio de novas regras de tributação teve um impacto importante na evolução da cobrança.
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    Small businesses, share buybacks, tax auditing and the use of valuation methods: An analysis of the Portuguese case
    (1999) Martins, António
    Purpose – The purpose of this paper is to analyze how share buybacks can be, in Portuguese small privately held firms, a source of tax-based conflicts between shareholders and tax administrations. Two issues are of particular relevance: the favored tax treatment of capital gains relative to dividends, and the use of valuation formulae to compute prices used in such transactions. The paper intends to present some advice to firms and consultants regarding equity valuation in privately held firms, to avoid tax based litigation. An extended analysis of the issue and its relevance to other jurisdictions is also presented. Design/methodology/approach – The paper is based on a conceptual discussion of the usual approach taken by the Portuguese tax authorities to challenge share buybacks in small, privately held, firms. The arm's length principle in transfer pricing rules is the cornerstone of the topic analysed. The paper compares the merits of alternative pricing basis, and shows the economic and legal problems that each alternative presents. Findings – The paper finds that the lack of tax neutrality between dividends and capital gains in Portugal can induce tax motivated transactions in small firms. The tax administration try to challenge these transactions on transfer pricing grounds. The alternative valuation strategy used by tax authorities is flawed, and puts the taxpayers in a good litigation position. However, a sensible valuation put forward by the firm can avoid such legal battles, which consume time and other resources of small owners. Practical implications – The owners of privately held firms and the tax authorities should use valuation methods in very sensible terms. Cash flow valuation rests on several assumptions. These assumptions should not be used to produce prices that are easily questioned and increase litigation between firms and taxpayers. Originality/value – The paper can be a source of practical advice for small business owners and advisors, as far as share transactions and share valuation are concerned. It is useful not only for the Portuguese managers and tax authorities, but also for any country where taxation of dividends and capital gains induces tax motivated buybacks.