Starbucks Boosts Benefits Thanks to Trump Tax Plan

starbucks bonuses
KRAKOW, POLAND - 2017/12/14: The logo of Starbucks seen in Krakow. (Photo by Omar Marques/SOPA Images/LightRocket via Getty Images)

“Hold accountable every Republican who voted for this obscenity of a tax bill” tweeted The Nation editor Katrina vander Heuvel after Trump’s Tax Cuts and Jobs Act passed. “They put donors over constituents, party over country.”

And a month later, without a hint of irony, vanden Heuvel tweeted out the following….

Yes, she’s thrilled that Starbucks is upping the benefits they offer employees.

Perhaps she didn’t read all too deep, because it’s all thanks to tax reform. According to the company’s press release,

Building on a long history of providing relevant, industry-leading benefits, Starbucks Coffee Company today announced a series of new partner (employee) offerings that span across wage and benefits. These offerings will total more than $250 million for more than 150,000 partners and are accelerated by recent changes in the U.S. tax law. Further details on the impact of these changes on our 2018 financial statements and earnings guidance will be discussed during our January 25 earnings call.

According to their financials, in Starbucks’s third fiscal quarter of 2017, they paid an effective tax rate of 34.3 percent. Trump’s tax plan will reduce it to 21 percent, which amounts to a decrease of nearly 40 percent. In other words, even if sales remain flat, Starbucks will see their bottom line increase an incredible 40 percent.

It’s no wonder, then, that they, and so many other companies, are shelling out some of the benefits to their employees. Among them will be a 2018 stock grant, where all employees will receive $500 in stock, while managers will receive $2,000. Meanwhile, a new “partner and family sick time benefit” will be eligible for employees, accruing at a rate of 1 hour for every 30 worked.

The company will also be creating over 8,000 part-time and full-time jobs at their cafes, and will be creating an addition 500 manufacturing jobs in Augusta, Georgia.

These benefits come into the rather impressive array that the chain already grants for a coffee shop. That includes health care benefits, disability and life insurance benefits, a 401(k) savings plan, and a free tuition program to study at Arizona State University online.

What an “obscenity.”

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By Matt

Matt is the co-founder of Unbiased America and a freelance writer specializing in economics and politics. He’s been published... More about Matt

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