Corporate Tax Cuts Don’t Create Jobs, They Enrich CEOs
A new study provides galling examples of this trend.
▻https://www.thenation.com/article/corporate-tax-cuts-dont-create-jobs-they-enrich-ceos
President Trump, after a summer of neglecting his top legislative priority, will make a full-throated pitch for tax reform today in Missouri. The still-fuzzy plan will have a lot of moving parts: lower top marginal rates, simplification of deductions, and elimination of the estate tax, which “only morons pay,” according to Trump’s economic adviser, Gary Cohn. But one centerpiece will be a significant reduction in the corporate tax rate, from the current 35 percent rate to as low as 20 percent.
This is necessary for three reasons, according to Republicans: “Jobs, jobs, jobs,” to quote House Speaker Paul Ryan this June. Though congressional Republicans and the White House rarely see eye-to-eye these days, they are united on the idea that cutting corporate taxes will spur an hiring boom that will reach down to the ordinary worker.
A new report from the Institute for Policy Studies shows this isn’t true. US companies are already paying minimal amounts in corporate taxes, and the ones most likely under Republican theory to pour tax savings into job creation have instead been more likely to cut their workforce over the past nine years. The data shows that low corporate tax rates more often lead to increases in CEO pay and boosts for shareholders.