President Obama has called for a major reform of our corporate tax system. The good news is that this will reduce the marginal corporate tax rate to 28 percent.

This would put the U.S. corporate income tax in line with most of our global competitors.

The serious bad news is that our president will penalize individual taxpayers who receive dividends. By effectively increasing the tax on dividends to nearly 45 percent, Obama will distort the allocation of capital in our country.

He will also discourage Americans from purchasing dividend yielding stocks. This will have a long-term negative impact on the stock market and for corporations desperate to raise equity capital.