Common stock dividend

A close look at the effect of the dividend tax cut reveals a disappointing investor reaction.

 

While some predicted a very significant increase in price for utilities if dividend taxes were reduced, the actual price change data show a rather different picture.

A new report from the Department of Energy may confirm what many in the electric industry have said all along: That while stranded costs could dissolve some short-term gains from competition, in the long term, consumers will still come out ahead.

"I'm surprised and delighted that the same EIA, which once wrongly predicted price hikes from natural gas deregulation, now confirms what we've been saying all along," said Rep. Tom Bliley (R-Va.).