When Congress reformed the nation’s tax code last year, the two parties clashed bitterly over whether it would juice the economy.
Rep. Ed Perlmutter, a Democrat from Congressional District 7, predicted it would give “the most benefits to corporations and the wealthiest Americans” at the expense of workers. Supporters of the tax overhaul like Rep. Mike Coffman, a Republican from Congressional District 6, said it would “help working families” and “increase jobs and wages by reducing the tax burden on American small businesses.”
Now that nearly a year has passed, we have a verdict. Colorado businesses are expanding operations, boosting wages, and hiring new workers. Families across the state are enjoying bigger paychecks.
For proof, look no further than your local King Soopers. Thanks to tax reform, the grocery chain raised its employee 401(k) matches and offered workers a new tuition reimbursement program.
Or look at Scheels, the sporting goods chain. The company gave bonuses to all its employees in Johnstown immediately after the bill became law. Similarly, Denver-based manufacturer Centennial Bolt awarded bonuses to its hourly workers equal to about 5 percent of their annual earnings. And Chipotle Mexican Grill, headquartered in Denver (at least for now), pledged to invest one third of its savings in its workforce, offering cash bonuses, stock bonusses, and expanding benefits like parental leave and short-term disability.
Nationally, the tax reform enabled hundreds of businesses to distribute about $4 billion in bonuses to 4 million workers, according to Rep. Scott Tipton’s remarks in Congress in June.
Tax reform didn’t only deliver one-time bonuses; lasting benefits abound. In Alamosa, First Southwest Bank used its tax savings to increase employees’ base wages and salaries. So did FirstBank in Longmont.
The list goes on. According to a recent survey from global insurance firm Willis Towers Watson, tax reform moved about two in three medium-sized businesses to boost 401(k) contributions and bolster employee benefits by adding programs like family leave and personal financial planning services.
It’s no wonder why Jimmy Sengenberger, president of the Denver-based Millennial Policy Center, credits tax reform for putting the nation “on the cusp of meaningful wage growth.”
Colorado companies are also using their tax windfalls to expand their workforces. Broomfield-based jar-maker, Ball Corporation, decided to add 400 more workers to its payroll.
SALUS, a small beauty supplier in Fort Collins, expects to save up to $1 million thanks to tax reform. The company recently hired an engineer to build manufacturing machinery — and plans to hire more workers to manage its new equipment.
All told, the U.S. Chamber of Commerce predicts tax reform will create over 17,500 jobs in Colorado.
Colorado’s economy is thriving. Not since the dot-com boom has Colorado seen such explosive economic growth. The state’s unemployment rate dropped from an already impressive 3.0 percent in December, when tax reform passed, to 2.8 percent in July, according to the most recent data from the U.S. Bureau of Labor Statistics. A recent survey from WalletHub named Aurora, Denver, and Colorado Springs three of the nation’s best cities to live.
Families have fatter wallets, too. On personal income taxes, the average four-person household in Coffman’s district is expected to save over $2,900 thanks to tax reform next year.
Just as Coffman predicted, tax reform is supercharging the state economy and benefiting Colorado’s working families.
Regina Thomson, a resident of Aurora, serves as president of the Colorado Issues Coalition, a nonprofit supporting reform in state government, protecting civil liberties, and addressing issues that are timely and critical to the voters of Colorado.
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