The Impact Of Taxation On The Capital Structure Of Listed Forestry Companies

Nowadays, about enterprise management, capital structure is no longer the problem of funding sources and financial costs, it has became the focus of corporate. In the many factors that affect capital structure arrangements, taxation is one of the factors which can not be ignored. Forestry is an important part of the national economy, after years of development, the forestry industry has formed a composite industry groups involved in three major industries of the national economy, a reasonable capital structure of great significance for the development of the forestry companies listed.This paper main studies how tax affect on the capital structure of the forestry enterprises. In this paper, we first reviews the domestic and foreign scholars on the theory of capital structure research. By the theoretical analysis, know about the current capital structure and tax status of forestry in China listed companies, obtain a preliminary understanding of the overview of the forestry enterprises. In this paper, selected fifteen forestry listed companies range from2006to2010, about five years of financial data to carried on the empirical analysis, make assumption, construct model for regression analysis. The paper choose the ratio of liabilities to assets, current debt ratio and long term debt ratio as the explained variables, and choose the effective tax rate as the explanatory variable. Besides, the paper choose the scale of the enterprise, profitability and the asset composition as the control variables. According to the results obtained from the empirical analysis, come to the forestry enterprise that the ratio of liabilities to assets and current debt ratio are positively correlated with the effective tax rate. Long term debt ratio negatively correlated with the effective tax rate. The results are inconsistent with the assumption, cause this results is mainly due to the China’s capital market of some limited factor. According to the results, making policy recommendations to optimize the capital structure of the forestry enterprise and put forward some good policy for tax in China’s tax context.