The name of the Tax Cuts and Jobs Act of 2017 describes its purpose: slashing the US corporate tax rate from 35 to 21 percent would result in executives investing the resultant savings into growing their companies, increasing productivity, creating jobs, equalizing wage inequalities. If only the executives were on the same page. Instead, many are funnelling the lion’s share of the windfall into share buybacks, benefiting their investors.
Trump Tax Cuts
No one enjoys paying taxes, so news of tax cuts is warmly welcomed. In December, the US government passed a tax act that sharply reduces rates across the board, most significantly for businesses. It would seem to represent a boon to the US economy—but with the economy already charging ahead at full steam, will it in the long run be a blessing or a bane?