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Economics & Strategy – Accounting & Tax Policy: Third
J.P. Morgan’s Dane Mott returns to third place after a year in the runner-up position.
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J.P. Morgan’s Dane Mott returns to third place after a year in the runner-up position. He does not expect the current Congress to address the so-called fiscal cliff of spending reductions and tax increases poised to take effect after December. “As a result, I expect the Bush-era tax cuts to expire for some or all U.S. taxpayers,” says Mott, who works out of San Francisco. “One implication is that the tax code will once again impose higher taxes on dividends relative to taxes on capital gains. This tax code bias may lead more companies to choose stock buybacks over dividends.” A new Congress may implement retroactive adjustments to fiscal-cliff issues in the first half of the year, he adds, but “I expect significant market volatility in November and December, similar to August 2011’s debt-ceiling crisis, with stocks with high dividend yields among the most negatively affected.” |