Fox Business
Expand
Browse All Video
Watch Live

You're watching...

Ben Stein on the Impact of the Potential Dividend Tax Increase

Details

  • Description

    Economist Ben Stein on potential increase in the dividend tax.

  • Duration 5:36
  • Date

Clips

Also in this playlist...

Latest Video

Auto-advance: ON

Auto-advance
View All

Transcript

This transcript is automatically generated

A whole foods is not telling -- he dated take it's a -- to lead stuff that kids stuff frugal well legacy could drive.

The health food chain the latest -- -- -- going full throttle on shareholder payouts instead it.

Spending their -- on hiring or expanding its hiking dividends to avoid a looming tax -- That rate will nearly triple.

On January want if congress doesn't do some Big Ben Stein on the -- get that many other.

Following that could prompt many.

To take a hike period I'm Dan good to have you back up what -- -- -- is because I always think this is the under the radar tax know once he's coming.

But could could probably have much more impact but it it.

It's gonna having -- gym -- a lot of the total return of the stock market.

Is dividends.

If the value of dividends is cut virtually and half because of tax agrees on dividends.

That has an enormous impact on the -- in the stock market in the stock -- guy is gonna have that as a big of bags on the -- of Americans and on their ability to retire.

So the overall effect of the -- -- On dividends.

Dividend taxes and can be actually astronomical and as you say somehow it that people -- acting as if it's not Catholic but it's having every American has retirement plan.

It there every person -- got a -- media.

You know then that was the single tests.

Explanations.

Of this entire phenomenon I've heard.

Well you flatter me -- I just thought of that -- you just.

Billy.

And slightly -- -- because -- -- good on here's my question and then.

One -- and added he said earlier this week I think of New York Times and -- where he talked about he never knew a successful investors.

Who was inhibited by the tax rate I'm paraphrasing here that you -- -- now on that opportunity.

Regardless of what the tax situation was so turning around your argument on dividends.

-- that it could have a big impact on it on on those -- say who might invest in in dividend paying stocks or the safety that you -- being a dividend -- -- That may -- that that won't happen at all when he next.

Well no I think -- that is tightly as somebody else he's saying that people will not start new businesses will not buy more plan will not add to employment you're right got a hundred that I won't still the overall investment airline guilty of -- doesn't but it will knock down the value and if you assume that -- -- -- 30% of long term game loses roughly the right amount.

In stocks is their dividends.

And and your guy who's got that by half then you're -- even -- it says -- very very very roughly very very roughly.

15%.

All of the value in the stock market I am just like that.

And this is not so in effect only wealthy people does affect anyone who is saving in the stock market -- -- or retirement and that is tens of millions of people.

The retirement situation of Americans is already -- -- critically bad.

And two herded this way is something we should be very very careful about as you well know -- -- been saying for a long long time.

We've got to raise taxes.

But I would we've got -- -- into the idea of raising taxes on people are preparing for retirement is very very questionable maneuver.

Out to his point were above its point that we've had.

Strong markets.

-- -- -- is stronger markets but it it in a much higher tax environment.

And but he may get a.

Well that's absolutely true except that built into the cake of value the stock -- anyone dime is.

One that the possibility of capital gains and Q the stream of dividends if you I got down to streaming news and December's diverting water away river river simply will not have the same amount of low and that's gonna -- of the value of the water government river and it's gonna affect the value of this of this of this -- -- -- eventually in time.

That'll be the market will be re priced and reassessed in terms of what is the average actually turn of the market.

And then we'll have a a more steady yet and more consistent -- drug.

But for now it is a big -- against -- stock market and the stock market and one of the few props in this precarious economy.

You know we -- all the companies that have of late been hiking their dividend.

On.

What's in it for them to do it now.

Well -- whatever that was of their stockholders.

Get a dividend before in the -- movement taxes increased.

Upon them and and that's a big plus for them and by the way they can accomplish very much the same thing.

You're stock buybacks.

-- stuck by Wright generally speaking Lawson beat them I was -- now envisioned through the -- game mechanism.

Which -- -- is doubly taxed so we'll probably -- -- great deal of that.

No we're not in -- radio hiring when that money -- -- we're not we're not sit down at all well them of the country is at a very do were unhappy mood altogether mean you've got Tug of bad but not seeing hired how many people do you see out of the shopping malls to big smiles on their -- I'm at the mall all the time people don't look happy.

You know even when he had a booming economy.

I would be at a mall and I wouldn't be happening.

Yes but we're talking with the other people the mall look at -- -- Ben Stein your genius my friend you know -- -- all right had a lot of it is star.

-- -- weekend business but you catch him on Fox News daily and business dark day in the always.

Well I think it's you but -- I think it's you you're you're you're more attractive.

The that if you very much stuck -- society groups that he's not couldn't I'd never heard such a good explains.

That's what makes in the -- all right.

Load More