More Evidence of How the GOP Tax Cut Really Works
by Stephen Lendman (stephenlendman.org – Home – Stephen Lendman)
Trump calling it a “middle class miracle” was a bald-faced lie.
It had nothing to do with cutting taxes for ordinary Americans – everything to do with enriching corporate predators and super-rich households more than already.
Corporate bosses are using their windfall for greater executive pay and bonuses, stock buybacks, increased dividends to shareholders, along with mergers and acquisitions – ordinary Americans stuck with empty promises.
Cisco Systems was the latest company to announce how its using its windfall. It’s returning $67 billion in offshore profits to America – most of it for for what’s explained above.
It’s stock buyback program was increased by $25 billion, the largest repurchase plan so far announced. Expect many more to follow.
Americans for Tax Fairness (ATF) executive director Frank Clemente issued a statement, saying:
“As predicted by many of us who opposed the massive Trump tax giveaway, Cisco is showing that the top priority of multinational corporations for their unprecedented tax cut is to shower shareholders with stock buybacks and higher dividends rather than distribute most of the benefits to workers who generate those profits.”
“This tax scam is hurting Americans another way, as shown by Cisco. ATF estimates that the Trump tax giveaway will save Cisco nearly $10 billion from what it should have paid in taxes on its $67 billion in offshore profits that it plans to bring home.”
“Cisco’s huge, unwarranted tax savings on its offshore cash, its failure to share any of it with its workers, and its big payoff to wealthy shareholders all show what’s wrong with the Trump-GOP tax scam that’s now law.”
“Instead of allowing multinational corporations to bring home their foreign profits at a steep discount, Congress should have demanded that they pay what they really owed on their offshore profits.”
“Then we’d have enough money for a real infrastructure program, among many other priorities of the American people.”
“Once again, wealthy CEOs and shareholders trump working people under this tax giveaway.”
Under former rules, corporate offshore profits returned home were nominally taxed at 35% – “less a dollar-for-dollar credit for foreign taxes paid,” ATF explained.
According to the Institute on Taxation and Economic Policy, Cisco paid a 7.2% foreign tax rate from 2008-15.
Instead of paying what it owes under old rules, it’ll only pay $9 billion dollars on repatriated foreign profits.
The company and many others like it will benefit hugely at the expense of ordinary Americans – mostly harmed by GOP plans to more greatly erode social justice than already to help pay for the great tax cut heist.
America is a plutocracy, not a democracy, thirdworldized by offshoring once plentiful high-paying jobs, destroying much of the nation’s industrial base, leaving around 100 million working-age Americans without jobs.
Most with them have rotten ones, needing two or more to survive – while corporate predators and wealthy households never had things better.
The great GOP tax cut heist and Trump’s neoliberal war budget promise worse ahead for the nation’s most vulnerable.
My newest book as editor and contributor is titled “Flashpoint in Ukraine: How the US Drive for Hegemony Risks WW III.”