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A dividend tax is an income tax on dividend payments to the stockholders (shareholders) of a company. This article does not cite any references or sources. ...
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Finance that studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation The term direct tax has more than one meaning: a colloquial...
The term indirect tax has more than one meaning. ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation An income tax is a tax levied on the financial income...
This article is the current Taxation Collaboration of the Month. ...
A capital gains tax (abbreviated: CGT) is a tax charged on capital gains, the profit realized on the sale of an asset that was purchased at a lower price. ...
Stamp duty is a form of tax that is levied on documents. ...
A sales tax is a consumption tax charged at the point of purchase for certain goods and services. ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation Value added tax (VAT), or goods and services tax (GST), is...
A flat tax, also called a proportional tax, is a system that taxes all entities in a class (typically either citizens or corporations) at the same rate (as a proportion on income), as opposed to a graduated, or progressive, scheme. ...
The tax, tariff and trade laws of a political region, state or trade bloc determine which forms of consumption and production tend to be encouraged or discouraged. ...
First discussed by the Physiocrats in France, tax incidence is the analysis of the effect of a particular tax on the distribution of economic welfare. ...
A tax (also known as a dutyor Zakat in islamic economics) is a charge or other levy imposed on an individual or a legal entity by a state or a functional equivalent of a state (e. ...
A flat tax, also called a proportional tax, is a system that taxes all entities in a class (typically either citizens or corporations) at the same rate (as a proportion of income), as opposed to a graduated, or progressive, scheme. ...
A progressive tax is a tax imposed so that the tax rate increases as the amount to which the rate is applied increases. ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation A regressive tax is a tax imposed so that the tax...
Tax advantage refers to the economic bonus which applies to certain accounts or investments that are, by statute, tax-reduced, tax-deferred, or tax-free. ...
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Comparison of tax rates around the world is a difficult and somewhat subjective enterprise. ...
This table lists OECD countries by total tax revenue as percentage of GDP (as of 2005). ...
Not to be confused with Political economy. ...
It has been suggested that monetary theory be merged into this article or section. ...
In macroeconomics, money supply (monetary aggregates, money stock) is the quantity of currency and money in bank accounts in the hands of the non-bank public available within the economy to purchase goods, services, and securities. ...
Fiscal policy is the economic term that defines the set of principles and decisions of a government in setting the level of public expenditure and how that expenditure is funded. ...
Government spending or government expenditure consists of government purchases, which can be financed by seigniorage (the creation of money for government funding, at a heavy price of high inflation and other possibly devastating consequences), taxes, or government borrowing. ...
A budget deficit occurs when an entity (often a government) spends more money than it takes in. ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation Government debt (also known as public debt or national debt) is...
This article does not cite any references or sources. ...
This article does not cite any references or sources. ...
A trade pact is a wide ranging tax, tariff and trade pact that usually also includes investment guarantees. ...
Finance that studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. ...
This article does not cite any references or sources. ...
There are two basic financial market participant catagories, Investor vs. ...
Domestic credit to private sector in 2005 Corporate finance is an area of finance dealing with the financial decisions corporations make and the tools and analysis used to make these decisions. ...
Personal finance is the application of the principles of finance to the monetary decisions of an individual or family unit. ...
This article does not cite any references or sources. ...
For other uses, see Bank (disambiguation). ...
Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank Money supply Fiscal policy Spending Deficit Debt Trade policy Tariff Trade agreement Finance Financial market Financial market participants Corporate Personal Public Banking Regulation An income tax is a tax levied on the financial income...
A dividend is the distribution of profits to a companys shareholders. ...
A shareholder or stockholder is an individual or company (including a corporation), that legally owns one or more shares of stock in a joint stock company. ...
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In many jurisdictions, the government requires the company to [[withholding tax|withhold at least the standard tax}}, paying this to the national revenue authorities and paying out only the balance to shareholders. The principle of a withholding tax is that it is withheld (retained) by the payer and given directly to the taxation authorities. ...
Controversy In most jurisdictions world-wide, dividend payments are considered ordinary income and are taxed as such, the same as if the taxpayer had earned the income working at a job. Depending on the jurisdiction, interest income, collected rents, or other "unearned income" may also be taxed. It is the subject of recurring debate as to whether or not these taxes should be eliminated. Under the United States Internal Revenue Code, the type of income is defined by its character. ...
Unearned income refers to income that is not a wage. ...
Arguments for abolition Abolitionists argue that a dividend tax amounts to unfair "double taxation", in the sense that the company has already paid a corporation tax on these profits, which means that the shareholders, as part owners, have likewise been taxed already.[1] Some even argue for the elimination of all taxes on investment income including interest income and capital gains. Jim Callaghan, the Chancellor of the Exchequer who introduced corporation tax in 1965. ...
There are three types of income - earned, portfolio and passive income. ...
In finance, a capital gain is profit that is realized from the sale of an asset that was previously purchased at a lower price. ...
Arguments to keep the dividend tax Some who want to keep the dividend tax as-is claim it is unfair to tax income generated through active work at a higher rate than income generated through less active means or that companies may not have paid their full share of income tax. A wage is the amount of money paid for some specified quantity of labour. ...
Unearned income refers to income that is not a wage. ...
Their argument is that such a taxation can help the wealthiest of individuals who can afford to buy large quantities of stock as they could feasibly live off the dividend payments without any income tax on their earnings.
Another aspect that is argued is that the taxation is not unique in being "double taxed" as there are many instances where the same cash flow is being taxed and to focus on this with such scrutiny while characterizing it as unique marginalizes other points of taxation.
Additionally, there is also the argument that dividend tax is completely voluntary and, as such, is worth exactly what is paid. A business can choose to form under various forms that are not separately taxed (e.g., S corporation, limited liability company, sole proprietorship and partnership). However, these flow-through entities do not offer investors the same liability protection, freedom to transfer shares, and ability to create different classes of equity. Accordingly, it is argued that an entity has no intrinsic right to those benefits and dividend tax is merely the cost to access those benefits. An S corporation or S-corp, for US federal tax purposes, is a corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code. ...
This article is about a U.S.-specific corporate form; for a general discussion of entities with limited liability, see corporation. ...
A sole proprietorship, or simply proprietorship, is a type of business entity which legally has no separate existence from its owner. ...
A partnership is a type of business entity in which partners share with each other the profits or losses of the business undertaking in which all have invested. ...
Double Taxation terminology The term "double taxation" is sometimes used (unconventionally[1]), mainly in the USA, by advocates of the removal of dividend income tax for investors.
Due to the debate over the dividend tax, US usage of the term "double taxation", in recent years, has focused on the dividend tax (though not exclusively). In fact, the same cash stream is often taxed any time it exchanges hands in many other instances. The consumer or retailer pay sales taxes when the goods are purchased and then the business has to pay income tax on it before the dividends are paid out or the company uses the same cash income to reinvest which is also taxed. The word "double" also directly implies redundance.
United States In 2003, President George W. Bush proposed to eliminate the U.S. dividend tax saying that "double taxation is bad for our economy and falls especially hard on retired people". He also argued that while "it's fair to tax a company's profits, it's not fair to double-tax by taxing the shareholder on the same profits."[2] George Walker Bush (born July 6, 1946) is the 43rd and current President of the United States, inaugurated on January 20, 2001. ...
Retirement is the status of a worker who has stopped working. ...
A shareholder or stockholder is an individual or company (including a corporation) that legally owns one or more shares of stock in a joint stock company. ...
Soon after, Congress passed the Jobs and Growth Tax Relief Reconciliation Act of 2003, which included some of the cuts Bush requested and which he signed into law on May 28, 2003. Under the new law, dividends are taxed at a 15 percent rate for most individual taxpayers. Dividends received by low income individuals are taxed at a five percent rate until December 31, 2007 and become fully untaxed in 2008. These provisions are set to expire on January 1, 2011. The Jobs and Growth Tax Relief Reconciliation Act of 2003 was passed by the United States Congress on May 23, 2003 and signed by President Bush five days later. ...
May 28 is the 148th day of the year (149th in leap years) in the Gregorian calendar. ...
Year 2003 (MMIII) was a common year starting on Wednesday of the Gregorian calendar. ...
Canada In Canada, there is taxation of dividends, but tax policy attempts to compensate for this through the Dividend Tax Credit or DTC for personal income in dividends from Canadian corporations. An increase to the DTC was announced in the fall of 2005 by Liberal finance minister Ralph Goodale just prior to the fall of the Liberal minority government, in conjunction with the announcement that Canadian income trusts would not become subject to dividend taxation as had been feared. Effective tax rates on dividends will now range from as low as 3% to over 30% depending on income level and different provincial tax rates and credits. An income trust is an investment trust that holds income-producing assets. ...
Ralph Edward Goodale, PC , MP, BA , LL.B (born October 5, 1949, in Regina, Saskatchewan) was Canadas Minister of Finance from 2003 to 2006 and continues to be a Liberal Member of Parliament. ...
An income trust is an investment trust that holds income-producing assets. ...
Other countries In Finland, the dividend taxation will be in use as of 2005. Income tax is 29% for a stockowner and the total tax will be around 50%. Year 2005 (MMV) was a common year starting on Saturday (link displays full calendar) of the Gregorian calendar. ...
In the Netherlands there is a tax of 1.2 % per year on the value of the share, regardless of the dividend, as part of the flat tax on savings and investments. This article does not cite any references or sources. ...
In the Netherlands there is an income tax, which is roughly as follows. ...
In Bulgaria there is a tax of 7% on dividends.
In Romania there is a tax of 16% on dividends.
In Poland there is a tax of 19% on dividends. This rate is equal to the rates of capital gains and other taxes.
In the UK, companies pay corporation tax on their profits and the remainder can be paid to shareholders as dividends. Basic rate tax payers have no further tax to pay as the dividend is deemed to have been received net of 10% tax. For higher-rate taxpayers, additional tax must be paid at 22.5% of the net dividend received (32.5% less the 10% deemed tax deduction, calculated on the deemed gross payment of the dividend). Jim Callaghan, the Chancellor of the Exchequer who introduced corporation tax in 1965. ...
In the Republic of Ireland, companies paying dividends must generally withhold tax at the standard rate (as of 2007, 20%) from the dividend and issue a tax voucher to include details of the tax paid. A person not liable to tax can reclaim it at the end of year, while a person liable to a higher rate of tax must declare it and pay the difference. 2007 is a common year starting on Monday of the Gregorian calendar. ...
In Australia dividends are taxed at the recipient's marginal tax rate (up to 46.5% from 1 July 2006). Australia (like New Zealand) has a Dividend Imputation system which allows franking credits to be attached to dividends. This allows recipients of franked dividends to impute (or credit) the corporate tax paid by the paying company. A recipient of a fully franked dividend on the top marginal tax rate will effectively pay only about 23% tax on the cash amount of the dividend. Dividend imputation in the Australian tax system allows companies to attach franking credits to dividends paid. ...
A franking credit is a nominal unit of tax paid by companies paying tax in countries that have a dividend imputation system. ...
In India, dividends are not taxed in the hands of the recipient. A domestic company pays a dividend distribution tax of 12.5% on the amount of dividend distributed. This rate is proposed to be increased to 15% in the Finance BIll, 2007.
See also There are three types of income - earned, portfolio and passive income. ...
Estate tax is a form of tax imposed in the United States upon the transfer of the property of the estate of a deceased person that is left to a living person or organization. ...
State income tax is an income tax in the United States that is levied by each individual state. ...
Double taxation is a situation in which two or more taxes may need to be paid for the same asset, financial transaction and/or income and arises due to overlap between different countries tax laws and jurisdictions. ...
Taxation in the United States is a complex system which may involve payment to at least four different levels of government. ...
References - ^ Taxation authorities world-wide use the term double taxation to mean that taxation is levied by two or more different jurisdictions on the same gain. This is clearly unfair and is usually mitigated by tax treaty
Double taxation is a situation in which two or more taxes may need to be paid for the same asset, financial transaction and/or income and arises due to overlap between different countries tax laws and jurisdictions. ...
Tax treaties exist between many countries on a bilateral basis to prevent double taxation (taxes levied twice on the same income, profit, capital gain, inheritance or other item). ...
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