In the Feb. 7 State of the Union address, President Biden called for quadrupling the tax on corporate stock buybacks. Critics say that such buybacks enable corporations to funnel tax-advantaged payments to wealthy investors instead of paying taxable dividends to shareholders. In August 2022, an excise tax on corporate stock buybacks was enacted that was intended to encourage companies to invest in growth, as opposed to paying corporate executives and foreign investors. The current 1% stock buyback tax was included in the Inflation Reduction Act. But with Republicans in control of the U.S. House, it’s unlikely Biden’s proposal will go anywhere soon.
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