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Corporations Use Tax Scam for Stock Buybacks, Billionaires Get Even Richer

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The new tax law is not only riddled with errors – the magnitude of which are not normal – it is giving top executives and rich shareholders massive gains as corporations are using “much of the money” to buy back their own shares. The top 1 percent of richest households already own 40 percent of all stocks and are expected to benefit the most from buybacks, worsening inequality and taking away investments in our economy such as research and development, and hiring.

All four GOP candidates for Senate in Montana support this tax scam despite the fact that it will add more than $2 trillion to our nation’s debt, increase taxes on tens of thousands of working Montanans, and hand the top 1% wealthiest Montanans and corporations even more tax cuts.

All this is in addition to the latest bad news:

ICYMI: The New York Times: Trump’s Tax Cuts in Hand, Companies Spend More on Themselves Than on Wages
By Matt Phillips
February 26, 2018

Key Points:

  • “…so far, companies are using much of the money for something with a more narrow benefit: buying their own shares.”
  • “Those so-called buybacks are good for shareholders, including the senior executives who tend to be big owners of their companies’ stock.”
  • “But the purchases can come at the expense of investments in things like hiring, research and development and building new plants — the sort of investments that directly help the overall economy.”
  • “The buybacks are also most likely to worsen economic inequality because the benefits of stocks purchases flow disproportionately to the richest Americans.”
  • “…the vast majority of the billions of dollars in planned share purchases will benefit the richest 10 percent of American households, who own 84 percent of all stocks.”

Read the entire article HERE.

ICYMI: Politico: ‘This is not normal’: Glitches mar new tax law
By Brian Faler
February 24, 2018

Key Points:

  • “The glitches in the new tax law are starting to pile up.”
  • “It’s hardly surprising there would be bugs in the sprawling new law H.R. 1 (115), but some experts say the sheer number is unusual, and blame the breakneck pace at which the legislation was pushed through Congress.”
  • “‘This is not normal,’ said Marty Sullivan, chief economist at the nonpartisan Tax Analysts. ‘There’s always this kind of stuff, but the order of magnitude is entirely different.’”
  • “Pam Olson, a former top tax official in the George W. Bush administration, is not optimistic lawmakers will be able to address the glitches this year.”

Read the entire article HERE.

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