Comment by shivasaxena
18 days ago
To call it a loophole makes no sense to me.
Also, smarter policy would be like what Estonia does
- CIT should only be applicable when dividends are paid. So corporations can reinvest that money in the business and not be taxed on it.
- PIT on dividend income should be 0, since that amount has already been taxed(CIT) and the stock holder has paid his due share on that income as a owner of corporation.
>CIT should only be applicable when dividends are paid.
Or dividends should be taxed as normal income.
Dealing with capital gains tax is messier but not impossible.