Republicans' tax cut scam proving a windfall for Wall Street, making it a hard sell on Main Street
Republicans are already finding it a challenge to run on their single new legislative accomplishment in the Trump era—the tax scam. Voters are underwhelmed by it, if not downright hostile to it, and most people just aren't going to see much relief from it at all. Meanwhile, they're seeing headlines like this: «Big banks saved $3.6B in taxes last quarter under new law.» That's probably not going to be helping the Republicans' PR job here.
Big publicly traded banks—such JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs, Morgan Stanley and Bank of America—typically kick off the earnings season. Their reports for the January-March quarter are giving investors and the public their first glimpse into how the new tax law is impacting Corporate America. […]
JPMorgan Chase said it had a first-quarter tax rate of 18.3 percent, Goldman Sachs paid just 17.2 percent in taxes, and the highest-taxed bank of the six majors, Citigroup, had a tax rate of 23.7 percent. This is just one quarter’s results, however, and bank executives at the big six firms have estimated that their full-year tax rates will be something closer to 20 percent to 22 percent.
Remember the old corporate federal rate was 35 percent, and because these banks tend to have more U.S.-based holdings than other corporations, being U.S. banks, they've paid among the highest rates. With all the previous existing loopholes, they tended to pay between 28-31 percent of their income under the previous rates. So, yes, the new law is a windfall for them, putting them on track to save an estimated $19 billion this year. That $19 billion could sure feed and house a lot of poor people, were it going into the treasury instead of to stockholders.