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Eastman Chemical increases quarterly dividend

KINGSPORT, Tenn. (AP) -- Eastman Chemical Co. said Thursday that it has increased its quarterly cash dividend by 15 percent.

The specialty chemical company's new 30-cents-per-share dividend is payable Dec. 31 to shareholders of record as of Dec. 17. That is up from its prior payment of 26 cents per share.

This is Eastman's third cash dividend increase in two years. It typically pays its quarterly dividend in December.

A number of companies have moved up quarterly payouts or issued special end-of-year payments to protect investors from potentially having to pay higher taxes on dividend income starting in January.

Since 2003 investors have paid a maximum 15 percent on dividend income. But that historically low rate will expire in January unless Congress and President Barack Obama reach a compromise on taxes and government spending. As it stands, dividends will be taxed as ordinary income in 2013, the same as wages, so rates will go up depending on which income bracket a taxpayer is in. For the highest earners, the dividend rate would jump to 43.4 percent.

Eastman Chemical shares rose 58 cents to $60.85 in afternoon trading.