Re:-1, Redundent (Score 3, Insightful)

Eliminating the dividend tax is in no way a tax shelter.

You think it won't be used as such? Give it a few years, and there'll be corporate compensation schemes in place that will low-ball salaries and overload on (tax-free) dividends.

Money will still be getting taxed on corporate profits only under the new rule it would only get taxed once.

False analogy! Corporate stock dividends aren't corporate profits; they're only one result of corporate profits. Using your analogy, salaries to corporate workers shouldn't be taxed either.

Btw, corporate profits aren't necessarily taxed all that frequently. In 1960, corporations paid 24% of all federal taxes. In the 1970's, that share fell to 15%. As recently as 1996, it was 12%. Now, corporate taxes make up only about 8% of U.S. revenues.

And how many corporations (by that, I mean the ones that haven't moved their post office boxes to Bermuda yet) are paying no Federal taxes, but are receiving tax refunds instead?

The current double taxation on dividends is an impediment to a free market and discourages the best (long term) kind of investing.

That's based on the same false analogy from before. Removing the tax on dividends will simply lower tax revenues and create a giant set of loopholes for corporate fat cats to exploit.