Joel Mowbray on the reasons why getting rid of the (double) taxation of dividends is a good thing, and why merely reducing it by 50% would be far less then half as good.

The only variable at this point is that the White House may only propose a 50% cut in the dividend tax because of the “cost” of the full monty. But as ATR’s Norquist explains, killing the tax is an easier sale to make because “eliminating the dividend tax is a principle, but cutting it in half will come across as special pleading, asking for a favor.” And in the new political reality where there are more stockholders than jobholders at the voting booth, eliminating the dividend tax is one principle the President would be smart to fight for.

Exactly. The reason to get rid of the tax is it's unfairness, and the biases it creates in companies and investors. The benefits to taxpayers are just gravy.