This is nonsense because companies can and do replace dividends with share buybacks.
While sometimes criticized as "executives juicing the stock price because that's what their incentives are tied to", in fact investors recognise that buybacks are economically equivalent to dividends, but tax-advantaged (for exactly the reasons you gave, they don't create a taxable event for the shareholders).
One problem with buybacks is it's socially difficult for companies to replace dividends with buybacks - by convention, dividends are usually issued on a regular schedule and buybacks are ad-hoc, so "cutting dividends" is seen as a sign of a company that no longer has reliable profits. But that really is just convention and it would only take a few companies switching to normalize this.
While sometimes criticized as "executives juicing the stock price because that's what their incentives are tied to", in fact investors recognise that buybacks are economically equivalent to dividends, but tax-advantaged (for exactly the reasons you gave, they don't create a taxable event for the shareholders).
One problem with buybacks is it's socially difficult for companies to replace dividends with buybacks - by convention, dividends are usually issued on a regular schedule and buybacks are ad-hoc, so "cutting dividends" is seen as a sign of a company that no longer has reliable profits. But that really is just convention and it would only take a few companies switching to normalize this.