Friday, May 16, 2003

While the moon was eclipsing: Senate OKs Temporary Dividend Tax Cut

WASHINGTON (Reuters) - The U.S. Senate on Thursday agreed to temporarily eliminate taxes on corporate dividends as a way to bring a $350 billion tax cut package more in line with President Bush's original proposal. In a vote of 51-50, with Vice President Dick Cheney breaking a tie, the Senate agreed to amend the tax legislation to provide for a temporary elimination of taxes on dividends. >>Full story...

Comments: First of all, let me say I agree with ALL tax cuts. The federal government is too big and has too much power and they spend our money like they have a blank check and a rich sugar daddy ... democrats and republicans service themselves, period.

Having said that, if I remember correctly, several years ago particular companies were considered sound by some during the tech crash because of their huge cash reserves. Other articles suggested that large shareholders didn't want these companies to pay dividends because they didn't want to pay the taxes ...

My conspiratorial mind asks: does the "temporary" dividend tax cut now allow the insiders to drain the cash from these companies taxfree ... is this a prelude to insider selling of stock once the cash is drained ... what does it mean for the future of these companies .... how does this stimulate the economy or help the ones actually hurt by the recession?

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