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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 234.38+0.5%3:25 PM EST

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To: Lizzie Tudor who wrote (157504)5/29/2003 9:19:01 PM
From: Victor Lazlo  Read Replies (1) of 164684
 
<<I reject this POV. It assumes cash payouts in the form of dividends are favorable to mkt share gains. It penalizes growth companies. >>

Dividends come from the ongoing profits of mature co's while dramatic equity share gains are usually reserved for the fast growing co's that plow eaernings back into co growth, thus attracting investors due to their future earnings potential.

Since the cap gain tax is lower than the div tax, one could argue that double taxation of divs unfairly singles out div-paying co's for extra taxes, thus providing artificial attractiveness for growth co stocks over mature div-paying ones.

Why should the govt favor one type of co over another?
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