On Tax Day, Ranking Member Ron Wyden (D – Ore.) released a Senate Finance Committee Report to show the GOP’s fleecing of America.
13 million Americans are expected to lose their health coverage due to the Trump Tax Law’s repeal of the ACA individual mandate, while everyone else’s premiums are expected to rise dramatically. Meanwhile, health insurance companies and big pharma are making out like bandits.
The Wyden reportdetails three key ways that Fortune 500 health care companies are benefiting from the new tax cuts:
Corporate Tax Cuts: The new law lowered the corporate tax rate from 35% to 21%, allowing companies to keep more of their profits. Information shared by just 20 of the 37 Fortune 500 health care companies indicates that they will save $10 billion per year in tax breaks, meaning $100 billion in savings over the next 10 years. This table from the report shows which companies are projecting tax savings, and how much they’re saving:
Slashed Tax Rate on Foreign Earnings: The new tax law left a big present for Corporate America. In the past, earnings from overseas operations were subject to the 35% standard corporate tax rate, so companies would just keep money oversees to avoid paying taxes on it. The new tax law included a fabulous provision for them: now they can import all of their amassed foreign profits at a one-time transition tax of between 8% and 15.5% – lower than the new standard rate. Companies have already taken advantage of this law to the tune of tens of billions of dollars.
Stock Buy-Backs: Given the extra cash on hand, companies are already using it to buy back stock in their own companies, which has the effect of boosting share prices. Boosted share prices mean increased investment earnings for shareholders. Most CEOs receive stock-based compensation. The companies analyzed in the report have already raked in $28 billion via buy-backs.
Across the five companies that have authorized stock buy-backs and where CEOs are due to profit substantially, the report shows that CEOs already earn salaries at a ratio of 127-to-1 and 388-to-1, in comparison to their average employee.
Expect more stories like this as the long-term effects of the tax scam become known.