If dividends and capital gains are taxed at the same rate,should investors prefer cash dividends or share buybacks?

Question

Quizplus · Accepted Answer

If dividends and capital gains are taxed at the same rate, investors should not have a preference between cash dividends or share buybacks as they would result in the same after-tax cash flow. The decision would depend on other factors such as the company's financial situation and future prospects.

If Dividends and Capital Gains Are Taxed at the Same