Corporate Taxation and Firm-Specific Determinants of Capital Structure: Evidence from the UK and US Multinational Firms

This paper aims to examine whether effective tax rate and firm-specific factors (such as firm size, growth opportunities, tangibility, risk, profitability, non-debt shields liquidity) impact the capital structure of multinational firms in energy sector. We employ regression models consisting OLS, fixed effect random test balanced panel dataset based UK USA over period 2011–2019. show a positive significant profitability on long-term total debt measures structure. In case short-term debt, however, we reveal that it is significantly negatively related liquidity, positively associated with risk. Moreover, report size are insignificantly leverage choices firms, liquidity has inverse relationship debt. study reveals mixed support for prevailing theories evidence unequivocally responsive The results contribute evaluating sector how managers can achieve an optimal level