WASHINGTON – Last week, the Republican Congress passed the most significant tax reform bill in three decades, and companies are already starting to react.
The Tax Cuts and Jobs Act, signed into law last Friday by President Donald Trump, implements sweeping tax reform including significant corporate tax reform. Under the new legislation, the corporate tax rate drops from 35 to 21 percent. While Democrats attempt to slam the bill as a giveaway to CEOs and high-income earners, several companies are already passing on the tax cuts to employees through bonuses, pay raises, and business expansion.
AT&T was the first company to announce special bonuses as a result of the tax plan, promising to give $1,000 bonuses to 200,000 of its U.S. employees. The special bonus would go to union-represented, nonmanagement, and front-line management employees, and the checks are expected to be in the mail before the end of the year.
Following the passage of the bill, Boeing pledged $300 million in investments including expanding the employee gift-match program, offering greater workforce development and education, and enhancing the workplace environment.
Wells Fargo and Fifth Third Bancorp announced plans to raise the minimum hourly wage for all employees to $15 per hour. On top of the raises, Wells Fargo promised $400 million in philanthropic initiatives in 2018, and Fifth Third Bancorp will give out $1,000 bonuses for over 13,500 employees.
Comcast, which owns NBC, also immediately reacted to the tax cuts, giving $1,000 bonuses to more than 100,000 non-executive employees. According to Fox Business, the company also plans to invest $50 billion over the next five years with the expectation of creating thousands of new jobs.
U.S. Bank of America has announced $1,000 bonuses for almost 145,000 employees. PNC Financial services plan to raise their minimum hourly wage to $15 per hour before the end of the year and will give a $1,000 to over 90 percent of their employees within the first quarter of 2018.
Over 2,000 employees at Melaleuca Inc., a wellness products company, will receive a $100 bonus for every year they have worked for the company. Over 147 employees have been with the company for over 20 years.
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Editor’s note: This story has been revised and updated.