President Trump and Republicans have repeatedly sold their tax bill to the public as a way to make American businesses more competitive so companies will turn around and hire more workers and raise wages. Critics of the plan say the massive reduction in the corporate tax rate from 35 to 21 percent, among other changes favoring business, will lead to more money in the hands of shareholders.

The Washington Post looked at what America’s 20 largest companies in the Fortune 500 say about taxes. Nearly all have vocally supported the GOP bill. Many say at least some of the extra money would probably go to shareholders via higher dividends. Other popular plans for additional cash include: looking for other companies to buy and paying down debt. Only two — AT&T and CVS — have made explicit promises to hire workers. Apple and Kroger executives have made vague statements that they would probably hire more people. Not a single company has said it will raise wages, although AT&T announced a one-time special bonus for workers after Trump signs the bill. As executives analyze the final 500-page bill, here’s what they say so far about their plans.

Company plans to ...

use extra money for hiring.
use extra money for shareholders.
use extra money for investing.
Company has no specific plans.
Tax reform is not helpful to company.


Current effective tax rate: 32.7 percent. Plans to invest $1 billion more. AT&T announced Wednesday it will give its 200,000 U.S. workers a $1,000 “special bonus” because of the tax bill, but the company stopped short of raising wages.

AT&T is committed to invest an additional $1 billion in the United States in 2018 if a tax bill with a permanent corporate tax rate of 21 percent is signed into law. Every $1 billion in capital invested in the telecom industry domestically creates about 7,000 U.S. jobs, research shows.”

Berkshire Hathaway

27.5 percent tax rate. CEO doesn’t think tax cuts are needed. Berkshire Hathaway chief executive Warren Buffett said in October:

It would be good for a million shareholders of Berkshire in terms of their net returns.” But he added: “I don’t think I need a tax cut.”


25.5 percent tax rate. Vague pledge to hire more in the United States. Apple CEO Tim Cook said in November:

“I believe that tax reform is sorely needed in this country. . . . The biggest issue with corporations is that if you earn money outside the United States, which most companies increasingly will . . . the only way you can bring it into the U.S. and invest is if you pay 40 percent [tax]. This is kind of a crazy thing to do, so what do people do? They don’t bring it to the United States. . . . In my view, it should have been fixed years ago, but let’s get it done now.”

When asked by NBC’s Lester Holt whether he expected Apple to use residuals to add more jobs, Cook said:

“Yeah, I do.”

CVS Health

39 percent tax rate. Pledge to hire 3,000 more workers. CVS Health CFO David Denton said in November:

“To the degree that we have [tax] relief, there’s a lot of investments that we think we can make within our business model that can more rapidly expand our business model across the country and deliver better care and higher quality and lower cost. So we would look to take the benefit of that and invest it clearly.”

Exxon Mobil

Negative tax rate last year, although in other years, Exxon has paid as high as 33 percent. Priority is dividends. Exxon Mobil Vice President of Investor Relations Jeffrey Woodbury said in October:

The first things that are being funded are our dividends and our investment program. And if there’s any cash left at that point given that the corporation does not want to hold large cash reserves, it’s at that point that we will look for what the next best thing is. And maybe if we have some debt maturing, we’ll pay that debt down.”


34 percent tax rate. Promise to help shareholders and employees. Costco CFO Richard Galanti said earlier this month:

“I think you’ll see us do what we do well, it’s merchandising and driving business and taking care of our employees and ultimately taking care of our shareholders. . . . We don’t know what we’re going to do yet because first, we got to figure out what’s actually going to happen.”


33 percent tax rate. Vague pledge to add more jobs and give more to shareholders. Kroger CEO W. Rodney McMullen said in November:

“We’re very excited about where the tax reform is headed. We believe it will also influence for us to continue to invest in our business, which will grow jobs. And I think what will end up happening is you’ll see us doing a balance of everything together. Some of it our shareholders will benefit from, some of it our associates will benefit from, and our customers will benefit from it as well.”


The tax rate varies a lot from year to year, but has tended to be around 39 percent. Plans for higher dividends and more investment. Chevron CEO John Watson said in March:

“I strongly support tax reform. We typically have tax rates higher than the U.S. statutory rate, so we don’t keep money offshore. It’s really a decision for us of where we can profitably reinvest the dollars that we’ll be generating out of Australia as well as think about giving some of it back to shareholders in the form of higher dividends.”


30 percent tax rate. No specific plans. Walmart CEO Doug McMillon said in November:

“We haven’t done a lot of detailed planning on it yet, but I do think something’s going to happen and I’m optimistic that a lower tax rate for individuals as well as for business will help spur the economy and drive more growth. We think the conversation around a territorial system is appropriate. Beyond that, we’ll just have to wait and see how the details work out.”


33 percent tax rate. No specific plans, although company generally plans to invest more and look for mergers and acquisitions. AmerisourceBergen CEO Steven Collis said in May:

“Over the longer term, we continue to approach capital deployment strategically and opportunistically and our priorities are as follows: One: invest in the business. As I mentioned earlier, we are continuing to invest in infrastructure and quality assurance processes and to enhance our services and solutions product offerings all to better serve our customers and drive organic growth. Two: strategic M&A. We are always evaluating ways we could further add to our value proposition and grow AmerisourceBergen through the addition of best-in-class and market-leading businesses. We are interested in enhancing our broad range of core capabilities to better upstream and downstream customers and build on our proven track records on M&A and success. Three: share repurchases. We are open to and have board authorization for continued buyback of AmerisourceBergen shares, and we will repurchase when we believe it is the optimal way to build shareholder value. And finally, four: dividends. We remain committed to providing shareholders with a reasonable dividend.”

General Motors

21 percent tax rate. No specific plans. General Motors CEO Mary Barra said earlier this month:

“We’re very supportive of tax reform, and generally the bills before Congress move in the right direction.”


24 percent tax rate. No specific plans, although company has been looking for M&A opportunities. McKesson CEO John Hammergren said in October:

We do prefer M&A [mergers and acquisitions]. But as you know, we do this in a portfolio way. We’re not afraid to do share repurchases. We talked about our share repurchase in the quarter and we clearly talked about our dividend again this press release and we talked about M&A.”


40 percent tax rate. No specific plans. Company is watching health care reform. UnitedHealth CEO David Wichmann said in October:

“I would like to just underscore that our capital deployment philosophies will be consistent with what you’ve seen in the past. It’s important for us to drive strong returns and liquidity for our shareholders. You’ll continue to see our dividend move to a market rate, and we’ll be balanced about how we managed our debt positions as well.”


32 percent tax rate. Plans to invest more. Ford Group Vice President of Government and Community Relations Ziad Ojakli wrote this in a letter to U.S. senators:

“[The bill] enables our critical investments in next-generation technologies like autonomy and electrification — and coupled with our provisions, like the EV [electric vehicle] tax credit, it helps support market adoption of these innovations.”


37.5 percent tax rate. No specific plans. Amazon CFO Brian Olsavsky said in February:

“We have a long-standing practice of not commenting on regulatory or tax matter[s].”

General Electric

Currently paying a negative tax rate. No specific plans. General Electric CEO John Flannery said in November:

“So, listen, I would say, I would characterize this and think of 2018 as a reset year.”


35 percent tax rate. No specific plans, although the company has been raising dividends. Verizon CFO Matthew Ellis said in October:

“The board of directors demonstrated our commitment to return value to our shareholders when they declared the 11th consecutive annual dividend increase last month.”

Cardinal Health

33 percent tax rate. No specific plans. Company is focused on health reform. Cardinal Health CEO George Barrett said in February:

“We generally have been a supporter of tax reform. I think we’re well-positioned broadly, and I think we’re nimble enough to continue to adapt to short-term dynamics at work. . . . If the medical device tax were brought back, that could be a negative.” [The medical device tax is not dealt with in the tax bill and is currently slated to return in 2018]

Walgreens Boots Alliance

23 percent tax rate. No specific plans. Walgreens Boots Alliance CEO Stefano Pessina said in January:

So let’s see when we will have the frame of the tax, and after we will start immediately to think how we can live in this new environment.”

Fannie Mae

Lower tax rate not helpful to company. Fannie Mae CEO Timothy Mayopoulos said in November:

“As we describe in our filing, a significant reduction in the corporate tax rate would require us to record a substantial reduction in the value of our deferred tax assets. We expect this would result in a significant net loss.” [The mortgage giant is in its 10th year of federal government control.]

About this story

Sources: Public statements, interviews with chief executives, earnings calls. Effective tax rates from S&P Dow Jones Indices. Noun Project icons from Hamish, Saeful Muslim, Adrien Coquet, Davo Sime and Darrin Loeliger.

Originally published Dec. 20, 2017.

Design and development by Courtney Kan.


Most Read

Follow Post Graphics