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Even when a company pays little to no tax, the government does get itself a pretty good taste of the profits via the dividend tax.
by karzeem 16y ago
Even when a company pays little to no tax, the government does get itself a pretty good taste of the profits via the dividend tax.
- DarkShikari 16y agoGood thing all big companies, such as, say, Google, pay plenty of dividends, right?
- jwang815 16y agoNope, Google has no paid out a single dividend. As long as Google thinks it can use the money to reinvest in the company and give investors a nice return from capital gains
- DarkShikari 16y agoNope, Google has no paid out a single dividend. That was the joke.
- nickpp 16y agoBut dividends kept should increase stock value and the government does get a nice cut when selling those, right?
- 2arrs2ells 16y agoDividends are taxed as ordinary income, while (long-term) capital gains are taxed at a significantly lower rate.
- karzeem 16y agoI know it's called profit, but the money they keep goes back into the business. The ways for it to be profit in the sense of making the shareholders rich(er) are by increasing the value of the stock or by going to shareholders as a dividend. And both of those avenues are taxed.
- 2arrs2ells 16y agoCould someone run a quick report - what percent of EBITDA (for the S&P 500) for the past year was paid out as dividends? My hunch is that it's only a tiny fraction, but that might just be because I follow tech stocks primarily (which tend not to pay dividends).