Dividends

In 2001 and 2003, President George W. Bush proposed and Congress passed a series of tax cuts to reinvigorate the economy and reduce the government's burden on workers' paychecks. Because of opposition to these measures from some in Congress, they were implemented as temporary tax cuts, all of which will… Read more

Myth 1: Lowering capital gains tax rates will not help the economy. Fact 1: Cutting capital gains tax rates is the single best tax policy to improve economic growth. Capital gains play a unique role in fostering economic activity, especially by entrepreneurs in high-technology areas. The current top statutory rate of 20 percent significantly exceeds the… Read more

Some leaders in Congress want to increase the federal tax on gasoline by 5.45 cents per gallon, for the first year, and then index it to inflation. They would use the revenue from this tax increase to finance additional spending on highways and other transportation projects, which they say will benefit the economy. Macroeconomic… Read more

Two recent National Bureau of Economic Research (NBER) papers begin the formal study of whether the 2003 dividend tax cuts affected corporate dividend policy. Economists have debated for years whether lowering individuals' taxes on dividends would lead to increased corporate payouts, and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) provides a… Read more

Last year's legislation adding a prescription drug benefit to Medicare is the biggest unfunded entitlement expansion in nearly 40 years. Unfortunately for taxpaying Americans, the projected 10-year cost-estimated at $400 billion last year but now already well above $500 billion-is just a drop in the bucket compared to… Read more

The 2001 and 2003 tax relief packages are set to expire at the end of this year. If these packages are allowed to expire, on January 1, 2011, taxes will go up automatically for American taxpayers—without a single piece of legislation ever crossing the President’s desk. President… Read more

President Barack Obama has called for a huge, $921 billion tax increase beginning on January 1, 2011. Congressional Democrats intend to meet his request and more—after the mid-term elections.[1] To achieve the bulk of this increase, they need merely do nothing: The tax relief enacted a decade ago… Read more

The President has proposed raising the tax on dividend income from 15 to 20 percent while his allies in Congress have created a procedural path whereby the income tax rate on dividends could again reach 39.6 percent. At the same time, it has been suggested by some that the deduction… Read more

House and Senate negotiators are hammering out details of a tax bill that would extend the 15 percent tax rate on dividends and capital gains for two years. Failure to reach an agreement would result in a major tax increase beginning January 1, 2009, when the capital gains tax rate would climb to 20… Read more

Why is the 2003 tax cut working so much better than the 2001 tax cut? Why is the economy performing better, for instance, and why are tax revenues growing faster than projected today compared to what happened after the 2001 tax legislation? The answer is that not all tax cuts are created equal. Tax… Read more