Dividends are different from interest in that they still own the shares which can grow in value as well. The same argument can be made for rental income or just about anything you wish.

Why should I pay tax out of my paycheck? Wasn't it already taxed somewhere somehow?

Corps pay taxes on net income, unfortunately there are so many deductions and write downs, what remains to be taxed is a nit.

I too am in favor of a flat tax but with zero deductions for anybody or any entity. No more depreciation, no more R&D deduction. No more deducting children or yachts or second homes. No more corp subsidies. No more off shore money laundering. True capitalism without corp welfare on the backs of the taxpayer.

Docspud, I think you are thinking of capital gains and yes it does suck if you made $20K selling a stock only to lose $20K on another in the same year you are taxed as if you saw a $17K profit because of the $3K limit on losses. I pay a butt load of taxes mainly because I don't qualify for any deductions like most of America. Rarely has a tax cut ever benefited me.