We analyze the impact of progressive taxation on irreversible investment under uncertainty. We show that if tax … exemption is lower than sunk cost, higher tax rate will decelerate optimal investment by increasing the optimal investment … investment threshold is a positive function of volatility, but independent of tax rate. For "medium" volatilities it is …

demonstrates the neutrality properties of the reform with respect to investment, firm financial decisions and organizational choice …. Tax rates are chosen to prevent income shifting from labor to capital income. The reform decisively strengthens investment …

demonstrates the neutrality properties of the reform with respect to investment, firm financial decisions and organizational choice …. Tax rates are chosen to prevent income shifting from labor to capital income. The reform decisively strengthens investment …