Did dividends increase immediately after the 2003 reduction in tax rates?
By: Jennifer L. Blouin, Jana Smith Raedy, Douglas A. Shackelford.
Contributors: Raedy, Jana Smith.; Shackelford, Douglas A.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 10301; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 10301.
Publisher: National Bureau of Economic Research
Published: 2004
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Dividends -- Taxation.
Description: "The Jobs and Growth Tax Relief Reconciliation Act of 2003 reduces the maximum statutory personal tax rate on dividends from 38.1 percent to 15 percent.  This study analyzes dividend declarations in the quarter following passage.  Aggregate dividends rose by 9 percent when boards of directors first met following enactment.  Consistent with the dividend changes being tax-motivated, they are increasing in the percentage of the firm held by individuals.  Dividend changes also increased with insider ownership, consistent with managers acting in their own interests.  However, these results are limited primarily to firms that made large, special dividends.  We find little evidence of an increase in regular, quarterly dividend payments"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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