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J & J Snack Foods hikes dividend by 23 percent

PENNSAUKEN, N.J. (AP) -- J & J Snack Foods Corp. is raising its quarterly dividend by 23 percent and will make the next payment before potentially higher tax rates are imposed in January.

The owner of snack brands such as Luigi's and Superpretzels said its quarterly dividend will climb to 16 cents per share, up from 13 cents per share previously.

The next payment is scheduled to be made Dec. 27 to shareholders of record as of Dec. 11. That schedule means the dividend will fall under the 15 percent tax rate that has been applied to stock dividends since 2003. That could change beginning next year, unless Congress and President Barack Obama reach a compromise on taxes and government spending.

Without an agreement, dividends will be taxed as ordinary income in 2013. For high-income households, that could result in dividends being taxed at a rate as high as 43.4 percent. Even if a political compromise is reached on taxes for next year and beyond, dividend recipients could still be facing higher bills than they did under the 15 percent rate.

The upcoming dividend covers J & J's fiscal fourth quarter. After last year's fiscal fourth quarter, the Pennsauken, N.J., company waited until calendar had turned to 2012 to pay the dividend covering that period.

J & J's stock gained 68 cents to close Thursday at $62.76. Based on that price, J & J's new dividend will yield about 1 percent annually.