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You tax the buyback itself, right? You tax the money the company is spending on its own stock. That's the only step of the transaction where money is changing h
by entropicdrifter 7y ago
You tax the buyback itself, right? You tax the money the company is spending on its own stock. That's the only step of the transaction where money is changing hands
- pc86 7y agoI'm not trying to be obtuse, I'm genuinely curious how this would work and what changes to tax law would need to be made. Would you tax the entity buying the stock (in case always a company since it's a buyback; which I think would be the only example of taxing a stock purchase), or the entity selling the stock (either an individual or a company, which is already potentially taxed as capital gains)? If the goal is to tax it similar to dividends you would tax the person selling the stock but it's already taxed as capital gains, either long term (0%/15%/20%) or short term (marginal bracket rate).
- brianwawok 7y agoIsn’t that a double tax? Taxed at buyback time, and taxed when shareholder cashes out and realizes their gain? Though I guess a small (10%??) tax could still make buyback tax + dividend long term gains is still less than normal income tax.
- zaroth 7y agoTriple actually. Corporate profits tax, new hypothetical buyback tax, and then again as capital gains when the shareholder sells.
- take_a_breath 7y agoI pay taxes on my income, on my purchases, on my property and again on my property’s appreciation when I sell.
- frockington1 7y agoGet ready for the wealth tax, now the politicians will be able to grab you're money in the intermediate steps as well
- shantly 7y agoEverything's a "double tax", but people only care sometimes, for whatever reason.
- sigstoat 7y agoyou just taxed the folks selling it at the same time. does the company get a tax break if it buys its shares back at less than it sold them for?