Sen. Marco Rubio (R-Fla.) stated in an interview published Friday that Republicans “probably went too far” reducing corporate taxes in their just-enacted tax code bill.
Rubio said he expects corporations to pay higher dividends to shareholders and buy back shares to raise their stock price with proceeds from the law.
“You’re going to see a lot of these multinationals buy back shares to drive up the price,” Rubio informed the southwest Florida-based News-Press.
“Some of them will be forced, because they’re sitting on historic levels of cash, to pay out dividends to shareholders,” Rubio explained. “That isn’t going to create dramatic economic growth.”
The GOP tax bill cut the corporate tax rate from 35 percent to 21 percent. Republicans have claimed that the corporate tax cut would result in higher wages and more jobs for U.S. workers.
Several U.S. corporations that were in support of the tax bill announced raises, bonuses and benefits increases for employees right after Congress passed the measure on Dec. 22. These include such corporate giants as Boeing, Wells Fargo, Comcast, AT&T and nearly a dozen others.
But other corporations are planning to spend the savings on benefits for executives, board members and shareholders. The White House chief economic adviser, Gary Cohn, was visibly stunned at an October interview when just a handful of CEOs in attendance said they would reinvest tax savings in hiring and expanding.
Rubio said that while the bill contained several things he was in favor of, “If I were king for a day, this tax bill would have looked different.” He and Sen. Mike Lee (R-Utah) successfully got GOP leaders to increase the child tax credit, a provision designed to assist struggling families.
Rubio said he believes Americans will embrace the tax bill once the changes are put into place.
“If I’m against the tax bill because I don’t think it’ll actually cut my taxes and I get my first paycheck in February and it has $200 in there that didn’t used to be there, I’m going to notice that,” Rubio stated.
“By the time we get to November of next year, their opinion about the tax bill is not going to be based on media coverage. It’s going to be based on what their paycheck is telling them.”