Is it Rational to Minimize Tax Payments?

DOI: 10.4236/me.2010.11004   PDF   HTML     4,270 Downloads   7,853 Views  

Abstract

The opinion is occasionally voiced that investors should avoid paying tax at all costs. In this paper it is being investigated, using a simple portfolio model with taxes, whether avoiding tax really leads to more µ-σ-efficient solutions. It is demonstrated for four different concepts of tax-minimising policy that they are a far cry from an efficient solution.

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A. Loffler and L. Kruschwitz, "Is it Rational to Minimize Tax Payments?," Modern Economy, Vol. 1 No. 1, 2010, pp. 47-50. doi: 10.4236/me.2010.11004.

Conflicts of Interest

The authors declare no conflicts of interest.

References

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[2] M. Jonas, A. Löffler and J. Wiese, “Das CAPM mit deutscher Einkommensteuer,” in German, Die Wirtsch- aftsprüfung, Vol. 57, No. 17, 2004, pp. 898-906.
[3] H. M. Markowitz, “Portfolio Selection,” The Journal of Finance, Vol. 7, No. 1, 1952, pp. 77-91.

  
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