Some European countries handle this by allowing it to be legal, but designing the tax rates so that you pay the same tax either way, so it's not really a tax do

Some European countries handle this by allowing it to be legal, but designing the tax rates so that you pay the same tax either way, so it's not really a tax dodge. In Denmark, for example: marginal income tax rate on salary/wages for higher earners is around 55% (including all the payroll taxes and such). Marginal rate if you pay yourself dividends instead: 23.5% corporate income tax up front, plus 42% personal dividend tax on the paid-out amount, or effectively... 55% again. In fact I believe the dividend tax level was chosen precisely to make it come out the same overall. (The story comes out similarly if you look at effective instead of marginal tax rates, e.g. for $100k income, it's about 40% effective tax either way.)