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Share Buyback Tax’s Lag Could Spur Rush to Repurchase This Year

  • Companies have until year end before new tax set to begin
  • Wyden said measure is meant to “check” surge in buybacks
RF CEO office

Photographer: Tom Merton/OJO Images/Getty Images

The new 1% levy on stock buybacks in the US Senate’s tax and climate package isn’t slated to go into effect until 2023, which means that there could be a flurry of repurchases before the end of this year.

Senate Democrats aim to pass legislation containing the buyback tax as soon as Sunday, but that portion wouldn’t take effect until Jan. 1, 2023, according to the text of the bill released Saturday. That gives corporations nearly five months to plan any additional buybacks before the levy goes into effect.