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Heinz moves up payment of quarterly dividend

PITTSBURGH (AP) -- H.J. Heinz Co., the world's biggest ketchup maker, is declaring a quarterly dividend of 51.5 cents per share. The company said Friday that it is moving up the payment of the dividend, a step that many companies are taking ahead of impending tax increases and government spending cuts at the start of 2013.

The White House and Republican congressional leaders are trying to strike a deal to avoid falling off the fiscal cliff, as the combination of simultaneous tax hikes and spending cuts have been dubbed.

Heinz is the latest company to move up the payment of its quarterly dividend to protect investors from potentially having to pay higher taxes on dividend income starting in January.

The company said the quarterly dividend will be paid Dec. 26 to shareholders of record Dec. 11. The company said that the dividend is normally paid in early January.

Heinz spokesman Michael Mullen said that the company adjusted the quarterly dividend payment date in response to requests from shareholders.

Many companies are reviewing their dividend policies now that it appears investors could soon pay higher taxes. 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.

In late November Heinz reported that its second-quarter net income rose 22 percent, helped by a significantly lower tax rate and gains in emerging markets.

Shares of the Pittsburgh company, whose other products include Weight Watchers Smart Ones entrees and T.G.I. Friday's snacks, shed 13 cents to $58.37 in midday trading.