Here is a thought experiment. If the company was buying another company’s share at market price as an investment, would you want them to pay more or less to acquire those shares? Surely, if they pay a premium for that share, the selling shareholder will benefit at the expense of the shareholder of the company. Shouldn’t the same argument apply for buyback of shares?
Also, it is not true that there is no tax on buyback. The company is going to pay a buyback tax and not the shareholder selling the shares. This buyback tax is still value eroding if we believe that companies can create value buying more for less and erode value for the shareholder by paying more for less.