Person: De Vito, Antonio
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Antonio
Last Name
De Vito
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IE University
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IE Business School
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Accounting & Management Control
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Publication Taxing the Digital Economy. Is the DST the Right Solution(SEFO, 2020-11) Allevato, Giulio; De Vito, Antonio; https://ror.org/02jjdwm75This paper examines the current income tax challenges of the Digital Economy, and the current proposals to tax digital firms where the users of their products or services are located. Building on law and economic literature, the paper firstly reviews the theory on corporate taxation, paying attention to the evidence on tax avoidance and profit shifting of multinational firms. The paper then argues that introducing a new tax on digital businesses could prove ineffective and lead to several distortions on corporate decision-making, especially in the case of unilateral and uncoordinated implementation.Publication Estimating the COVID-19 cash crunch: Global evidence and policy(Elsevier, 2020-04-25) Gómez, Juan Pedro; De Vito, Antonio; https://ror.org/02jjdwm75In this paper, we investigate how the COVID-19 health crisis could affect the liquidity of listed firms across 26 countries. We stress-test three liquidity ratios for each firm with full and partial operating flexibility in two simulated distress scenarios corresponding to drops in sales of 50% and 75%, respectively. In the most adverse scenario, the average firm with partial operating flexibility would exhaust its cash holdings in about two years. At that point, its current liabilities would increase, on average, by eight times, suggesting that the average firm would have to resort to the debt market to prevent a liquidity crunch. Moreover, about 1/10th of all sample firms would become illiquid within six months. Finally, we study two different fiscal policies, tax deferrals and bridge loans, that governments could implement to mitigate the liquidity risk. Our analysis suggests bridge loans are more cost-effective to prevent a massive cash crunch.Publication Estimating the COVID-19 cash crunch: Global evidence and policy(Elsevier, 2020-04) Gómez, Juan Pedro; De Vito, Antonio; Trombetta, Marco; Ministerio de Economía y Competitividad; Agencia Estatal de Investigación; European Regional Development Fund; https://ror.org/02jjdwm75In this paper, we investigate how the COVID-19 health crisis could affect the liquidity of listed firms across 26 countries. We stress-test three liquidity ratios for each firm with full and partial operating flexibility in two simulated distress scenarios corresponding to drops in sales of 50% and 75%, respectively. In the most adverse scenario, the average firm with partial operating flexibility would exhaust its cash holdings in about two years. At that point, its current liabilities would increase, on average, by eight times, suggesting that the average firm would have to resort to the debt market to prevent a liquidity crunch. Moreover, about 1/10th of all sample firms would become illiquid within six months. Finally, we study two different fiscal policies, tax deferrals and bridge loans, that governments could implement to mitigate the liquidity risk. Our analysis suggests bridge loans are more cost-effective to prevent a massive cash crunch.Publication Regulating the Financial Industry through Taxation Intended and Unintended Consequences of the Financial Transaction Tax(2020-09) Allevato, Giulio; De Vito, Antonio; https://ror.org/02jjdwm75This paper examines regulatory taxes as an alternative to regulating the financial industry to address negative externalities in financial markets. We review the theory on financial transaction taxes and provide an analysis on the economic consequences of such taxes. We argue that the implementation of the FTT could trigger significant increases in the cost of capital for firms as well as relocation and substitution risks, with detrimental effects on investment and economic growth. We furthermore analyze the challenges for the regulator to design and implement financial transaction taxes, while paying attention the current state of the art within the EU and in Spain. In this respect, we put forward that care should be taken when enacting financial regulatory taxes, especially when EU member countries implement such taxes unilaterally without a coordinated agreement.