STATESIDE Stateside
Sharon Harris explains the impact of Trump’s tax breaks – and wishes you a happy new year, of course
Gaming is already feeling the positive vibe. The South Point casino is Las Vegas’ first to double the average bonuses for all 2,300 full- time employees. Most will receive $500 each; higher earners $700-$2,300.
H
appy New Year. Buckle up…if 2018 in America resembles 2017, expect a wild ride this midterm election year. While campaigning, President Donald Trump vowed to dismantle what he
considered onerous regulations strangling free enterprise. And dismantle many, he has. The excessive political and media warnings of impending doom to the US economy in 2017 were wrong. Instead, many American businesses profited, the stock market and consumer confidence soared, plus unemployment fell. Congress passed the most sweeping tax reform bill since 1986 – minus Democratic participation – in late December. During Obama’s eight years, this destructive partisan pattern often flipped, as Republicans also regularly blocked legislation. Speculation over whether this tax reform law will help or hurt depends on your perspective. Permanent corporate tax rates drop from 35% to 21%. Personal taxes decrease for most because of increased deductions, through 2027. Some Democratic senators wanted a slightly higher corporate rate now and an analysis within a few years to make adjustments. I could agree to that for bipartisan support. The political left responded that “corporate tax
breaks only make them richer and hurt average workers.” Really? Gaming corporations, and thousands more across diverse industries, employ millions and enhance their communities. Casino properties, manufacturers and suppliers currently support 1.4 million jobs in 40 states. They also railed against reinstituting taxes in 2027.
That’s ridiculous. The political and economic landscape will certainly change and they can renew the rates if necessary. Hey, I hope I’m still here in ten years.
Millions who individually – or via their pensions
– invest in corporate stocks often depend on company profits to fund their retirements. Solvency obviously benefits a company’s staff and investors. By early January, 100 of America’s most diverse large
8 JANUARY 2018
and small companies had already awarded substantial employee bonuses or increased their hourly wages to $15. Last week, a Philadelphia Inquirer economic columnist warned that despite good news for workers in 2018, it could be short-lived. So what…within that timeframe, the extra money helps their families and stimulates the economy. With that depressing outlook, why even get out of bed? Gaming is already feeling the positive vibe. The South Point casino is Las Vegas’ first to double the average bonuses for all 2,300 full-time employees. Most will receive $500 each; higher earners $700-$2,300.
Owner Michael Gaughan acknowledged that although not a corporation, he expects a $1 million windfall from the Trump tax reform plan. In a local phone interview, he said, “We had a big year and I’m going to save some money with The Donald, so we just doubled the bonus and we dropped the insurance increase for next year.” No other casinos have revealed their plans yet, but hopefully many will follow suit to improve living conditions for tens of thousands of casino workers. MGM has also announced the hiring of 1,000 summer workers across their property portfolio. Following tax reform passage, American Gaming
Association (AGA) President/CEO Geoff Freeman praised the corporate tax reduction, but acknowledged that exact results will take time. No one knows the impact of doubling the individual standard deduction. Will fewer taxpayers itemize their gambling income/losses? AGA members should monitor customers’ behavior patterns and develop solutions with their Congressional supporters. Freeman said, “AGA is proud to have actively led an inclusive industry effort to ensure changes to the corporate tax code provide a net benefit to our members.” He cited three protected industry priorities:
• Customers may still itemize a net total on gambling income.
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