(Reuters) - The Republican-led U.S. House of Representatives in late December passed the biggest overhaul of the U.S. tax code in 30 years, a sweeping $1.5 trillion bill that President Donald Trump signed into law.
The tax plan is designed to kick-start economic growth in part by offering new incentives for capital investment, which would allow businesses to lower their tax bills by writing off the cost of new machinery, among others, more quickly.
The overhaul includes cuts to corporate tax rates and a cap on business deductions for debt interest payments.
The following are among companies that have talked about the impact of tax code revamp:
COMPANIES PROMISING HIGHER PAY FOR WORKERS:
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Company Name Comments
Southwest Airlines Co Authorized a $1,000 cash bonus to all employees
Sinclair Broadcast Group Inc To pay special bonus of $1,000 to almost 9,000
full-time and part-time employees
Kansas City Southern Said it would pay some employees in U.S. and
Mexico one-time bonus of $1,000 by 2017-end
Wells Fargo & Co To raise minimum hourly pay rate to $15 for
employees, from current minimum hourly rate of
$13.50
Fifth Third Bancorp To raise hourly wage for nearly 3,000 employees
to $15, give one-time bonus of $1,000 to more
than 13,500 employees
Comcast Corp To give $1,000 bonuses to more than 100,000
employees
AT&T Inc To pay special $1,000 bonus to more than 200,000
of its U.S. employees
American Airlines Group Inc To give $1,000 bonus to each team member at its
mainline and wholly owned regional carriers
Wal-Mart Stores Inc To raise entry-level wages for U.S. hourly
employees to $11
Walt Disney Co To pay more than 125,000 eligible employees
one-time $1,000 cash bonus
Home Depot Inc To provide a one-time cash bonus for U.S. hourly
associates of up to $1,000 in Q4
PepsiCo Inc Will give bonus of up to $1,000 to full-time
front-line U.S.-based associates
Lowe's Cos Inc To pay a one-time bonus of $1,000 for over
260,000 hourly U.S employees
Pfizer Inc Earmarked $100 mln for special one-time bonus to
be paid to all non-executive employees
Anthem Inc To make $1,000 contribution to 401,000 accounts
of more than 58,000 of its associates, recent
retirees
CVS Health Corp Will increase starting wage rate for hourly
employees to $11 an hour, effective April 2018
Humana Inc To increase minimum hourly rate in e Continental
U.S. for full- and part-time employees to $15
AbbVie Plans to accelerate pension funding by $750 mln
and enhance non-executive employee compensation
Thermo Fisher Scientific Inc To make $34 mln investment for a one-time bonus
of $500 for its non-executive employees
HIGHER INVESTMENTS:
Company Name Comments
AT&T Inc Plans to invest additional $1 bln in U.S.
in 2018
Comcast Corp To invest $50 bln over next 5 years to
improve infrastructure
Boeing Co To invest $300 mln in employee facilities
Southwest Airlines Co Donated $5 mln to charitable cause,
increasing its fleet investment
Apple Inc To invest more than $30 bln in U.S. over
next 5 yrs, create 20,000 jobs through
hiring at existing campuses and through a
new campus
Walt Disney Co To invest $50 million in new, ongoing
education programs designed to cover
tuition costs for hourly employees
ONE-TIME IMPACT ON PROFITS, HURT BY TAX-RELATED WRITE DOWNS:
Company Name Comments
Goldman Sachs Group Inc Would take a $5 bln earnings hit in Q4
Barclays Plc Expects to take writedown of about 1 bln pounds on
its 2017 post-tax profit
BP Plc To take one-off, non-cash $1.5 bln charge in its Q4
2017 earnings
Credit Suisse Group AG Expects to take writedown of 2.3 bln Swiss francs
during its Q4
Qiagen NV Would take one-time post-tax charge on net income
of about $110 mln-120 mln in Q4
Royal Dutch Shell Plc To incur charge to earnings of $2 bln-$2.5 bln,
based on Q3 statements
UBS Group AG Expects 2.8 bln Swiss francs writedown in Q4
RenaissanceRe Holdings Ltd Expects anticipated write-downs to reduce net
income by about $40 mln when tax bill is in force
Accenture Plc Expects to record a non-cash expense of up to $500
mln in fiscal 2018
Bank of America Corp Estimates net income for quarter ended Dec. 31 to
include reduction of about $3 bln as a result of
the new tax code
Citigroup inc Expects a one-time hit to GAAP capital of $20 bln
with $16 bln-17 bln related to write-down and $3
bln-$4 bln related to repatriation
American Express Co Expects to report a fourth-quarter loss due to a
$2.4 bln hit from the tax legislation. Also sees
full-year 2017 earnings to be below its $5.80-$5.90
per share forecast
D.R. Horton Says the tax act will result in a charge of about
$115 mln in Q1 of fiscal 2018. Company also
revising previously issued forecast by lowering
estimate for fiscal 2018 effective tax rate to
about 26 pct
Toronto-Dominion Bank Estimates one-time impact of Tax Act to reduce
profit for Q1 by about $400 mln
Aptiv Plc Expects one-time reduction to net income of about
$50-$100 mln in Q4 2017
Keller Group Plc Expects 2017 earnings will benefit from a one-off
non-cash credit of around $10 mln
Morgan Stanley Q4 earnings to take a $1.25 bln hit
Home Depot Inc $150 mln charge, coupled with the one-time bonus
payment, to negatively impact fiscal 2017 diluted
EPS guidance by about $0.19
BOOST TO PROFIT:
Company name Comments
Bayerische Motoren Werke AG Expects tax benefits to lift its 2017 net profit by
950 mln-1.55 bln euros
Daimler AG Expects an income tax benefit of about 1.7 bln euros
in its 2017 results
Iberdrola SA Expects to produce income of 1.2 bln euros in 2017
Mallinckrodt Plc Expects the reform to result in a deferred
taxbenefit of $450 mln to $500 mln
NuVasive Inc Sees savings from overhaul to boost adjusted
earnings by more than 10 pct in start of 2018
FedEx Corp Expects earnings to rise by $4.40-$5.50 per share
for FY18
Home Depot Inc Says "might" have an immediate benefit of $1.6 bln
CVS Health Corp Expects tax overhaul to boost its cash flow by $1.2
bln
Macy's Inc Expects adjusted earnings per share to rise to
between $3.59 and $3.69 in 2017
Celgene Corp Estimates earnings for the quarter and year ended
Dec. 31, 2017 to include estimated impact of about
$800 mln-$1.30 bln
Walgreens Boots Alliance Inc Expects to obtain cash tax benefit in excess of $200
mln for fiscal year 2018
British American Tobacco Expects 6 pct earnings per share boost in 2018
Target Corp Raises Q4 adj profit forecast, reflecting 6 to 8
cents benefit from lower structural tax rate in Jan
Home Depot Inc Currently estimates the net impact of tax reform on
its 2018 tax provision and cash taxes paid will be
beneficial
Procter & Gamble U.S. tax overall benefit of $135 mln in December
quarter to double in 2019 and to continue doubling
on and so forth - CFO on media call
(Compiled by Aishwarya Venugopal in Bengaluru)