Higher taxes on income, dividends, and realized gains incentivize money being reinvested in the business instead of distributed to shareholders. If taking money

Higher taxes on income, dividends, and realized gains incentivize money being reinvested in the business instead of distributed to shareholders. If taking money out of a company creates taxable income, stockholders have an extra reason to press companies to find ways they can use that money to increase value instead. Basically, an extra incentive for companies to hire more people and do more research instead of do things like stock buybacks.