TY  - JOUR
AU  - Blouin,Jennifer L.
AU  - Raedy,Jana Smith
AU  - Shackelford,Douglas A.
TI  - Did Dividends Increase Immediately After the 2003 Reduction in Tax Rates?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 10301
PY  - 2004
Y2  - February 2004
UR  - http://www.nber.org/papers/w10301
L1  - http://www.nber.org/papers/w10301.pdf
N1  - Author contact info:
Douglas Shackelford
University of North Carolina at Chapel Hill
Kenan-Flagler Business School
Campus Box 3490, McColl Building
Chapel Hill, NC  27599-3490
Tel: 919/962-3197
Fax: 919/962-4727
E-Mail: doug_shack@unc.edu
AB  - The Jobs and Growth Tax Relief Reconciliation Act of 2003 reduces the maximum statutory personal tax rate on dividends from 38.1 percent to 15 percent.  This study analyzes dividend declarations in the quarter following passage.  Aggregate dividends rose by 9 percent when boards of directors first met following enactment. Consistent with the dividend changes being tax-motivated, they are increasing in the percentage of the firm held by individuals. Dividend changes also increased with insider ownership, consistent with managers acting in their own interests.  However, these results are limited primarily to firms that made large, special dividends.  We find little evidence of an increase in regular, quarterly dividend payments.
ER  -