Lobbying and taxes

Brian Kelleher Richter, Krislert Samphantharak, Jeffrey F. Timmons

Research output: Contribution to journalArticlepeer-review

Abstract

Lobbying dominates corporate political spending, but comprehensive studies of the benefits accrued are scarce. Using a dataset of all U.S. firms with publicly available financial statements, we delve into the tax benefits obtained from lobbying. Firms that spend more on lobbying in a given year pay lower effective tax rates in the next year. Increasing registered lobbying expenditures by 1% appears to lower effective tax rates by somewhere in the range of 0.5 to 1.6 percentage points for the average firm that lobbies. While individual firms amass considerable benefits, the costs of lobbying-induced tax breaks appear modest for the government.

Original languageEnglish (US)
Pages (from-to)893-909
Number of pages17
JournalAmerican Journal of Political Science
Volume53
Issue number4
DOIs
StatePublished - Oct 2009

ASJC Scopus subject areas

  • Sociology and Political Science
  • Political Science and International Relations

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