When Donald Trump was campaigning for his massive tax cut bill in 2017, he promised that the average American household would see a $4,000 increase in its income as a result of the tax cuts, a claim that FactCheck.org critiqued as “dubious” at the time, saying “don’t count on it.” Now, a sweeping new study by a nonprofit investigative news organization shows that the result of Trump’s tax cuts for average Americans came nowhere close to Trump’s claims.
In fact, the investigation conducted by The Center for Public Integrity, in partnership with The Guardian, shows that while American corporations fattened their wallets by a whopping $150 billion under the “Tax Cuts and Jobs Act” signed into law by Trump on December 22, 2017, the employees of United States companies received only six percent of that amount in the form of new income.
Almost all of the remainder of that $150 billion went toward corporate stock buybacks — a financial maneuver that allows companies to artificially pump up their stock prices — and dividends to shareholders. But only 10 percent of Americans own 84 percent of all stocks, and it is that 10 percent who would have benefited most from the corporate tax savings, according to a summary of the new findings published by The Daily Mail.
In addition, according to The Center for Public Integrity, “at least 60 companies reported that their 2018 federal tax rates amounted to effectively zero, or even less than zero.” That’s more than twice as many companies paying zero tax as in previous years, on average — “a partial result of the 2017 Trump tax law.”
Leading the way in the parade of zero-tax companies was Amazon.com, which raked in $10.8 billion in profit last year. Amazon.com not only paid zero federal taxes, but received a “rebate” from the federal government, according to a report from The New York Times. Delta Airlines, the Chevron oil company, carmaker General Motors, and EOG Resources — an energy company formerly known as Enron — rounded out the top five most profitable corporations that paid no federal tax in 2018. All five received tax rebates for use in other years, as well,
Trump also claimed that the tax cuts would lead to a huge boost in job growth, because corporations would use their extra capital to invest in research, development, and other areas of growth. But that has not happened either, according to a Bloomberg report.
Investment “accelerated a bit in the first half of 2018, but has since slowed significantly,” according to the Bloomberg report, adding that the government will now need to borrow another $1 trillion to cover the cost of the Trump tax cuts — and that “so far, it’s hard to see what the country is getting in return.”