The Cashless Corporate Tax

44 Pages Posted: 12 Sep 2000

See all articles by Herwig J. Schlunk

Herwig J. Schlunk

Vanderbilt University - Law School

Date Written: September 25, 2000


This article attempts to replicate the most important features of the current corporate tax system in an alternative "tax" system under which the government participates in corporate income not through involuntary impositions, but as a shareholder. The article shows how the government's shareholdings would need to be structured to mimic current management incentives viz. the distribution of cash, thus producing desired revenue flows. The purpose of the proposal is to align corporate and government incentives: by maximizing shareholder value, the corporation also maximizes the government's value and ultimately its revenue. Thus, among other things, there would be no ability on the part of corporations to engage in some types of "tax shelter" activity.

Suggested Citation

Schlunk, Herwig, The Cashless Corporate Tax (September 25, 2000). Available at SSRN: or

Herwig Schlunk (Contact Author)

Vanderbilt University - Law School ( email )

131 21st Avenue South
Nashville, TN 37203-1181
United States
615-322-1527 (Phone)
615-322-6631 (Fax)

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