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Eliminating the Tax Cuts on Dividends and Capital Gains May Have an Adverse Effect on the Stock Market:  An Economic Argument


Author:  Ilhan Meric.; Ilene V. Goldberg.; Ira B. Sprotzer.; Gulser Meric.


Source: Volume 26, Number 01, Fall 2008 , pp.66-73(8)




Journal of Taxation of Investments

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Abstract: 

The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) lowered the tax rates on dividends and capital gains with a sunset provision. The cuts were set to expire at the end of 2008. However, the Tax Increase Prevention and Reconciliation Act (TIPRA) extended the tax cuts through 2010. Currently, there is a heated debate about whether the tax cuts should be made permanent. Here the authors study the possible impact of repealing the dividend and capital gains tax cuts on the stock market in the current economic environment.

Keywords: 

Affiliations:  1: Rider University; 2: Rider University; 3: Rider University; 4: Rowan University.

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