Companies in Australia opt for conservative tax strategies under imputation system
The article looks at how Australian companies handle taxes when distributing profits to investors. They studied data from 1999 to 2003 when the corporate tax rate dropped. Companies giving franked dividends tend to be more cautious with taxes. Managers paid with share options also take a conservative approach. Companies don't try to save on taxes before a tax rate cut. And if the tax office looks closely, companies play it safe with taxes.