Yes, the logic is that the corporation paid tax on their profits before dividends. Perhaps there's a case for corporation tax abolition and increased dividend taxation?
I actually wouldn't be averse to that, but it'd be hard to internationally coordinate such a change (and it would have to be internationally coordinated, or corporations would move to the places that had the lowest corporation tax while their owners would move to the places that had the lowest dividend tax). And there's still the problem of keeping your wealth in a corporation and avoiding paying tax on it until you use it (which creates the wrong incentive - we want to encourage rich investors to spend the money and put it back into the system, or at least invest in new ventures, rather than leaving it in their company's bank account accumulating compound interest).
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Yes, the logic is that the corporation paid tax on their profits before dividends. Perhaps there's a case for corporation tax abolition and increased dividend taxation?
I actually wouldn't be averse to that, but it'd be hard to internationally coordinate such a change (and it would have to be internationally coordinated, or corporations would move to the places that had the lowest corporation tax while their owners would move to the places that had the lowest dividend tax). And there's still the problem of keeping your wealth in a corporation and avoiding paying tax on it until you use it (which creates the wrong incentive - we want to encourage rich investors to spend the money and put it back into the system, or at least invest in new ventures, rather than leaving it in their company's bank account accumulating compound interest).
Actually, there's nothing to coordinate in setting your corporation tax to zero, but you'd likely incrementally increases dividend taxes.