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2018 | OriginalPaper | Chapter

A Note on the Gordon Growth Model with Taxes

Authors : Olga Belomyttseva, Larisa Grinkevich, Anastasiia Grinkevich

Published in: The Impact of Globalization on International Finance and Accounting

Publisher: Springer International Publishing

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Abstract

This paper analyzes the Gordon Growth Model and its evolution in various studies. A modification of the Gordon Growth Model using corporate income tax and personal income tax is developed. Two equations are presented, one of which is for determining the share price with taxes and the other for determining for the value of growth rate.

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previous chapter Relationship Between the Company Size and the Value: Empirical Evidence

next chapter Indirect Valuation and Earnings Stability: Within-Company Use of the Earnings Multiple

Technically, it is the personal income tax rate, but we use “dividend tax rate” to highlight the fact that we mean dividend income here. We do not consider the case when the investor is a legal entity.

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Title: A Note on the Gordon Growth Model with Taxes
Authors: Olga Belomyttseva
Larisa Grinkevich
Anastasiia Grinkevich
Publisher: Springer International Publishing
Book: The Impact of Globalization on International Finance and Accounting
Print ISBN: 978-3-319-68761-2

Electronic ISBN: 978-3-319-68762-9

Copyright Year: 2018
DOI: https://doi.org/10.1007/978-3-319-68762-9_17