Premium
Share Repurchases
Author(s) -
SHIRLEY PHILIP
Publication year - 1997
Publication title -
fiscal studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.63
H-Index - 40
eISSN - 1475-5890
pISSN - 0143-5671
DOI - 10.1111/j.1475-5890.1997.tb00261.x
Subject(s) - legislation , dividend , corporation , economics , government (linguistics) , income tax , business , distribution (mathematics) , monetary economics , public economics , finance , law , political science , mathematical analysis , linguistics , philosophy , mathematics
The UK government recently introduced legislation to treat the qualifying distribution on a repurchase of shares in the same way as ‘foreign income dividends’. This paper examines and criticises this reform from two perspectives. First, there is no underlying rationale for such an approach. Second, the legislation moves the tax system away from simplification. A better approach would have been to remove the advance corporation tax (ACT) charge on a repurchase. JEL classification : H25, K34.