Abstract

DUQUE OLIVA, EDISON JAIR  and  BAEZ ROA, MARIA DEL PILAR. EFFECT OF TAXES ON CAPITAL COST: CASE STUDY OF ALMACENES ÉXITO S.A. (2006 -2010). Rev.fac.cienc.econ. [online]. 2012, vol.20, n.2, pp.205-229. ISSN 0121-6805.

The purpose of this paper is to determine the effect that taxes have on capital cost through the case study of Almacenes Éxito S.A. (period 2006-2010), considering as reference of study the main premisesof Modigliani & Miller (1958, 1963). The main findings show that the effect of taxes does not decreases the capital cost of a company in the period of study. Therefore, debt contracting does not have a tributary benefit for this company.This allows concluding that for the corporation, the incentive to access to financing through debt is a decision of its investment strategy. This paper contributes to other works that analyze taxes since an economic approach relating corporation's internal perspectives.

Keywords : Capital cost; Corporative taxes; Tributary benefit; Debt.

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