The paper looks at how taxes affect banks' activities. By studying data from major countries between 1981-2003, it shows that bank profits are impacted by corporate income tax. Banks can pass on some of this tax to borrowers, depositors, and service buyers. The study finds that taxing bank profits is like taxing loans, leading to changes in how banks make money. Despite differences in tax levels, they don't fully explain why banks in different countries have varying profits.