CBS News - May 2019
When the Tax Cut and Jobs Act was signed into law in December 2017, many U.S. companies responded with press releases touting one-time bonuses to their workers. But how much of the savings from lower corporate taxes really went to workers?
Just $28 per worker, according to a new analysis from the Congressional Research Service.
A total of $4.4 billion went out in bonuses last year, estimated the nonpartisan office that's part of the Library of Congress. Divided among the 157 million people in the workforce, that comes out to under $30 apiece. "This amount is 2% to 3% of the corporate tax cut," wrote Jane Gravelle and Donald Marples, the report authors.
For comparison, the amount of money companies spent buying back stock was over $1 trillion, the CRS said. In other words, businesses spent 246 times as much money on their own stock as they did on worker bonuses.
It's unclear whether $28 shows an increase over whatever bonuses workers might have gotten without the tax cuts. The left-leaning Economic Policy Institute, which recently analyzed federal pay data, found that the average 2018 bonus was just 1 cent higher than the average bonus in 2017. "This is not what the tax cutters promised, or bragged about soon after the tax bill passed," EPI Senior Fellow Lawrence Mishel wrote.
The overall economy grew 2.9% in 2018—the same pace as it grew in 2015, and below the 3% annual growth on which Mr. Trump staked his campaign. Average wages, after inflation, grew at 1.2%, according to the Bureau of Labor Statistics.
Most Americans—about 4 in 5—paid less in taxes last year, with a median tax cut of $900. But many didn't realize their taxes went down through lower withholding numbers on their regular paychecks. Instead, they're asking what happened to the $4,000 to $9,000 raise the president promised them a year and a half ago. ...
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