Tax reform passes in US, AT&T and Comcast give holiday bonuses, increase capital expenditure
Congress has passed comprehensive tax reform with corporate tax rates permanently dropping from 35 percent to 21 percent from the new year. The first regime change in 35 years is one of supply-side (“trickle down”) economics which will most benefit big corporations like AT&T and Comcast.
As is the case, these companies are celebrating the new bill by giving $1,000 one-time bonuses to their non-executive ranks. AT&T last reported more than 256,000 employees in the third quarter while Comcast had more than 153,000 at the end of 2016. Ma Bell also announced that it is putting in another $1 billion in its capital expenditure plan for next year. Comcast is laying out a five-year, $50 billion infrastructure investment scheme.
The moves give President Donald Trump’s administration and the Republican majorities in the legislature some confidence that their tax plan is helping middle-class households. What’s left to be seen is if wage levels go up as well. With regards to AT&T in particular, when Trump passed along the news at a press conference, he commented “That’s pretty good. That’s pretty good.”
On a separate page, Trump is still against AT&T’s acquisition of Time Warner with a particular ire towards the latter’s CNN for its coverage of his politics. AT&T is also working on vamping its network to 5G specification at this point and this cash infusion will, in all hopes, speed up deployment to more markets in 2019 and 2020.