mergers and acquisitions

hi, Can someone please explain why where there is a case of stock purchase for an acquisition using securities offering the targets shareholders would be responsible for capital gains taxes on the deal and no taxes are levied against the target at the corporate level? An example is Book 6 Afternoon Session 2 Q 104 Thanks

because the corporation does not sell anything, the shareholders do ?

coming to think of it prob that is the caseā€¦