Justin Fox, Columnist

AT&T's Tax Cut Bonus Isn't Just a Gimmick

The cost of corporate taxes is ultimately borne by workers, shareholders and customers. Especially by workers.

December 20, 2017 at 9:55 PM UTC

Updated on

December 21, 2017 at 1:24 PM UTC

Justin Fox is a Bloomberg Opinion columnist covering business, economics and other topics involving charts. A former editorial director of the Harvard Business Review, he is author of “The Myth of the Rational Market.”

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Yes, AT&T Inc. chief executive Randall Stephenson's announcement that his company will be paying out $1,000 bonuses to 200,000 workers in the wake of the passage of a big corporate tax cut is probably to some extent a lobbying ploy.1513806720615 AT&T, as many, many people have noted this afternoon, has a giant acquisition (of Time Warner Inc.) currently being held up by antitrust regulators. It has every reason, then, to want to curry favor with the man for whom the tax bill represents a first major legislative victory, President Donald Trump.

But Stephenson's move is also a simple representation of what a lot of economists think is the natural result of a cut in corporate taxes. Corporations themselves don't ultimately pay taxes. As veteran tax wonk Bruce Bartlett put it a few years ago: