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Taxation influences upon the market in venture capital trust stocks: theory and practice

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Taxation influences upon the market in venture capital trust stocks: theory and practice. / Holland, Kevin; Jackson, Richard H.G.
In: Accounting and Business Research, Vol. 41, No. 1, 01.03.2011, p. 1-27.

Research output: Contribution to journal › Article › peer-review

HarvardHarvard

Holland, K & Jackson, RHG 2011, 'Taxation influences upon the market in venture capital trust stocks: theory and practice', Accounting and Business Research, vol. 41, no. 1, pp. 1-27. https://doi.org/10.1080/00014788.2011.549633

APA

Holland, K., & Jackson, R. H. G. (2011). Taxation influences upon the market in venture capital trust stocks: theory and practice. Accounting and Business Research, 41(1), 1-27. https://doi.org/10.1080/00014788.2011.549633

CBE

Holland K, Jackson RHG. 2011. Taxation influences upon the market in venture capital trust stocks: theory and practice. Accounting and Business Research. 41(1):1-27. https://doi.org/10.1080/00014788.2011.549633

MLA

Holland, Kevin and Richard H.G. Jackson. "Taxation influences upon the market in venture capital trust stocks: theory and practice". Accounting and Business Research. 2011, 41(1). 1-27. https://doi.org/10.1080/00014788.2011.549633

VancouverVancouver

Holland K, Jackson RHG. Taxation influences upon the market in venture capital trust stocks: theory and practice. Accounting and Business Research. 2011 Mar 1;41(1):1-27. doi: 10.1080/00014788.2011.549633

Author

Holland, Kevin ; Jackson, Richard H.G. / Taxation influences upon the market in venture capital trust stocks: theory and practice. In: Accounting and Business Research. 2011 ; Vol. 41, No. 1. pp. 1-27.

RIS

TY - JOUR

T1 - Taxation influences upon the market in venture capital trust stocks: theory and practice

AU - Holland, Kevin

AU - Jackson, Richard H.G.

PY - 2011/3/1

Y1 - 2011/3/1

N2 - Individuals investing in a venture capital trust (VCT) IPO listed on the London Stock Exchange receive a number of conditional tax incentives; the time-related nature of the associated conditions can create a ‘lock-in effect'. By deriving and testing a model of the value of these incentives we examine how they influence investors' pricing and trading decisions. This paper contributes to the ongoing tax capitalisation debate in three ways: first, by calculating the magnitude of the lock-in effect without reference to underlying shareholder records; second, by adopting a time series approach in view of the time-varying magnitude of the potential lock-in effect, and thereby avoiding control issues involved in cross-sectional analysis of the effects of taxation on pricing; and third, by focusing on changes in the bid–ask spread rather than, for example, mid price, so reducing the impact of changes in the market value of the instruments under consideration on the analysis. Our results have direct policy implic...

AB - Individuals investing in a venture capital trust (VCT) IPO listed on the London Stock Exchange receive a number of conditional tax incentives; the time-related nature of the associated conditions can create a ‘lock-in effect'. By deriving and testing a model of the value of these incentives we examine how they influence investors' pricing and trading decisions. This paper contributes to the ongoing tax capitalisation debate in three ways: first, by calculating the magnitude of the lock-in effect without reference to underlying shareholder records; second, by adopting a time series approach in view of the time-varying magnitude of the potential lock-in effect, and thereby avoiding control issues involved in cross-sectional analysis of the effects of taxation on pricing; and third, by focusing on changes in the bid–ask spread rather than, for example, mid price, so reducing the impact of changes in the market value of the instruments under consideration on the analysis. Our results have direct policy implic...

KW - listing,lock-in effect,relief,taxation,venture capital trust

U2 - 10.1080/00014788.2011.549633

DO - 10.1080/00014788.2011.549633

M3 - Erthygl

VL - 41

SP - 1

EP - 27

JO - Accounting and Business Research

JF - Accounting and Business Research

SN - 0001-4788

IS - 1

ER -