Taxes & Business Strategy (5th edition)

Book cover for Taxes and Business Strategy

Taxes & Business Strategy (5th edition)

By Myron S. Scholes, Mark A. Wolfson, Merle Erickson, Michelle Hanlon, Edward Maydew, Terry Shevlin
Prentice Hall, Upper Saddle River, 2015

For MBA students and graduates embarking on careers in investment banking, corporate finance, strategy consulting, money management, or venture capital.

Through integration with traditional MBA topics, Taxes and Business Strategy provides a framework for understanding how taxes affect decision-making, asset prices, equilibrium returns, and the financial and operational structure of firms.

“We adopt a planning approach to taxes and business strategy. More precisely, we adopt a global planning approach. The three key themes of this book’s global planning framework are:

  1. Effective tax planning requires the planner to consider the tax implications of a proposed transaction for all parties to the transaction. This is a global or multilateral, rather than a unilateral, approach.
  2. Effective tax planning requires the planner to consider all taxes. For example, in making investment and financing decisions, we consider not only explicit taxes (tax dollars paid directly to taxing authorities) but also implicit taxes (taxes that are paid indirectly in the form of lower before-tax rates of return on tax-favored investments). We are interested in a global measure of taxes, not simply explicit taxes.
  3. Effective tax planning requires the planner to recognize that taxes represent only one among many business costs and that all costs must be considered in the planning process. For example, to be implemented, some proposed tax plans may require exceedingly costly restructuring of the business … ”
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