I'm sorry, I misunderstood your comment. I assume you would not consider costs other uses of capital as buybacks, acquisitions or investments? In any case, I think it would be easier to tax dividends together with the rest of the profit and make it tax-free for the receiver. Otherwise you would have a problem with foreign shareholders and in particular with foreign-owned subsidiaries that would otherwise pay no taxes. There are already mechanisms to tax these distributions, but if you move the taxation of dividends fully to the shareholder side the resulting system would become even more complex.

I'm sure many would argue that such a change would be "transferring money to the pockets of the rich".

Any attempt to construct a flat tax would probably be interpreted as such.