• Double taxation means that income tax is paid twice from the same source of income.
  • Double taxation occurs when income is taxed both at the corporate level and at the individual level, as is the case with stock dividends.
  • Double taxation also means that the same income is taxed in two different countries.
  • While critics argue that double taxation of dividends is unfair, proponents say that without it, wealthy shareholders could all but avoid paying income tax.