Skip to main content

We asked Minnesota's Fortune 500 companies what they'll do with corporate tax cut savings

Here's what each of them said.
  • Author:
  • Updated:
    Original:

The country's biggest employers are being given a huge corporate tax cut, as it's reducing from 35 to 21 percent under the recently passed Tax Cuts and Jobs Act.

But the bill has proved controversial, not least because the wealthiest in the country stand to benefit the most, at a time when pay disparity between the rich and middle/lower earners is already huge.

With major corporations set to receive lower taxes, a burning question now is: Will these savings "trickle down" to ordinary workers once the bill is signed by President Donald Trump?

We took that question to Minnesota's largest companies.

Will savings from tax cuts be passed down to Minnesota workers?

After the bill was proposed, GoMN asked each of Minnesota's 17 Fortune 500 companies whether the cut in corporate taxes would lead them to do any of the following:

  • Increase employee wages
  • Hire more people
  • Invest in products/innovation
  • Increase dividends/share buybacks for investors
  • Increase executive bonuses
  • Boost its charitable giving
  • Reduce the cost of products/services
  • Increase spending on lobbying efforts

How did they respond?

Four of Minnesota's 17 Fortune 500 companies – CHS, General Mills. Target and C.H. Robinson – gave details on how they will use the money.

Both CHS and C.H. Robinson said some would be passed on to workers – in CHS' case through hiring and wage increases, and in C.H. Robinson's case through hiring and investing "capital back into growing the company."

Target said it would "pursue our strategic growth priorities" and hinted at some additional hiring or pay rises through its plans for "continued investment in the Target team." The company announced in September it would increase its minimum wage for workers to $11, and has plans to increase this eventually to $15 – which will now be easier to achieve.

General Mills told investors on an earnings call Dec. 20 that it would be returning some of the savings to shareholders, as well as increasing brand and capital investment.

As the only nonprofit on the list, Thrivent reckoned it won't see much of a change compared to for-profit companies.

The remainder of the companies either said it was too early to judge, or didn't respond to our enquiries at all, despite being given weeks to do so as well as several follow up calls and emails.

Two of the three biggest Minnesota companies, UnitedHealthCare and Best Buy, were among eight that declined to respond. This story will be updated as and when they do.

'Tax Christmas for the biggest earners'

Kim Clausing, professor of economics at Reed College in Oregon, told GoMN the surge in the stock market since the tax bill was proposed indicates where much of the savings will go: to shareholders.

"This is tax Christmas for the biggest earners that will be paid for by our children and grandchildren," she said.

"In the short run this is going to benefit shareholders and in the long run shareholders will still see the lion's share of benefits."

But moves taken in the immediate wake of the tax bill's passage suggest at least some large companies will give back to workers.

AT&T said it will give 200,000 employees a $1,000 bonus when the bill is signed, and announced significant investment in its capital spending.

Wells Fargo will be introducing a $15 minimum wage and pledged $400 million in charitable donations for the next year (it's got a LOT of goodwill to claw back).

All of the responses

Here's a look at all of the responses GoMN received from Minnesota's Fortune 500 companies. (We'll update this if and when we receive more).

Target (Minneapolis)

"The tax reform legislation passed through Congress will further enable Target to pursue our strategic growth priorities. These include continued investment in the Target team, in our business and our ability to serve our guests, and in the communities where we do business."

C.H. Robinson Worldwide (Eden Prairie)

"Corporate tax rate cuts will have a positive effect on our (and all) businesses, allowing us to invest more capital back into growing our company. Investing more capital means hiring more people and purchasing more services, all things that help grow the economy."

U.S. Bancorp. (Minneapolis)

"We do not have a comment at this time."

CHS Inc. (Inver Grove Heights)

"We worked closely with several elected officials to ensure the cooperative system voice was heard during recent conversations on Section 199.

"While the tax reform bill presents both challenges and opportunities for farmers and cooperatives, we remain optimistic about future investment, hiring and wage increases across the cooperative system and in rural communities."

Thrivent Financial for Lutherans (Minneapolis)

"Thrivent is a not-for-profit membership organization, so we expect the impact to be minimal compared to the impact on for-profit companies. As a fraternal benefit society, we use our tax-exemption to support our members in their generosity in communities around the nation and the world."

Ecolab (St. Paul)

"The proposed tax reform legislation is still very fluid. It is too early to discuss whether there will be any realized tax reductions for Ecolab."

3M (Maplewood)

"3M appreciates the President and Congress for enacting tax reform legislation that will result in a more globally competitive system for U.S.-based manufacturers."

General Mills (Golden Valley)

During an earnings call on Wednesday, GM executives said they will evaluate "several uses" including brand investment, capital investment, M&A (mergers and acquisitions), and "clearly, cash return to shareholders."

A spokesman also added: "On the corporate income tax reform we are encouraged by the efforts of the House and Senate to address the competitive tax advantage enjoyed by our foreign competitors."

Supervalu (Eden Prairie)

"At this time, Supervalu is still evaluating and will not be able to provide responses to your questions."

Mosaic (Plymouth)

"It is premature for us to answer these questions given that Mosaic is still assessing the impact of the new tax law. I also think it unlikely that we would make decisions like those you ask about based solely on potential tax savings."

The following companies have not responded:

  • UnitedHealthCare
  • Best Buy
  • Hormel
  • Ameriprise Financial
  • Land O'Lakes
  • Xcel Energy
  • St. Jude Medical

Next Up

Semi into house near Sturgis, South Dakota

Semi drives into house near Sturgis, South Dakota

The force from the semi was so strong that the foundation of the house was moved.

ambulance

18-year-old from Zumbrota dies in Goodhue County crash

The crash happened in rural Goodhue County around 8:45 a.m. Wednesday.

thomas beach, bde maka ska - lake calhoun

3 Minneapolis beaches closed due to E. coli contamination

No illnesses have been reported, according to the MPRB.

Hockeyland1

'Hockeyland' documentary debuting in Minnesota movie theaters

The documentary has received great reviews at numerous film festivals.

Flickr - police lights squad siren - Edward Kimmel

Former Minnesota Olympic runner accused of driving drunk in Eden Prairie crash

Police said the man's blood alcohol level was three times the legal limit.

ATV

Man, 79, killed in ATV rollover near Faribault

The man was declared dead at the scene.

minneapolis police

Woman fighting for her life after shooting in Minneapolis

The woman was shot only about a half-hour after a 14-year-old suffered critical injuries in an apparent accidental discharge.

prior lake high school

Two students face discipline over racist messages at Prior Lake High School

Families and students were largely uncooperative with the investigation.

Sharon and Herb Vasser

Cause of Hopkins house explosion that killed couple revealed

Sharon and Herb Vassar were killed in the explosion. Herb built the home back in 1962.

Arrows on target

Charges: Minnesota camp counselor fired arrows at kids, injuring boy

An 8-year-old boy was shot in the arm with an arrow.

North Shore Mayor Chris Swanson.

Two Harbors votes overwhelmingly to recall Mayor Chris Swanson

The mayor had been scrutinized for several things leading up to the vote Tuesday.

Screen Shot 2022-08-10 at 8.43.50 AM

Suspected gunman at large after homicide near Albert Lea

The 32-year-old suspect was last seen in a 2004 white Ford F-150 with Minnesota license number EUZ-057.

Related

DFL says plan would cut taxes for families, raise them for corporations

The tax plan is likely to be opposed by Republicans in the Senate.

17 MN companies make the Fortune 500 list – and one cracks the top 10

Target and Best Buy rank highly on the annual list, with Minnesota strongly represented.

Fortune Global 500 list includes six Minnesota companies

UnitedHealth Group, Target, Best Buy, Supervalu, 3M and Inver Grove Heights-based CHS are among Fortune’s list of the biggest companies in the world. Twin Cities Business reports all the Minnesota companies were on the list last year, but dropped in this year’s annual ranking, expect for CHS, who jumped 97 spots.

Ex-Best Buy CEO quits several boards over donation controversy

Brad Anderson says he wasn't aware how his money was being used.

Minnesota is losing another Fortune 500 company

The Mosaic Company is moving its headquarters to Tampa.

What time do stores open on Thanksgiving and Black Friday?

Some open on Thanksgiving Day, others wait until Friday.