Home Depot to dole out $1,000 bonuses to workers after tax cut
(Bloomberg) – Home Depot Inc. is joining the parade of companies offering perks to U.S. employees after the federal tax overhaul.
The world’s largest home-improvement chain will pay hourly workers a one-time cash bonus of as much as $1,000 in the latest quarter, Home Depot said on Thursday. The move follows legislation last month that lowered the corporate taxes by 14 percentage points -- to 21% from 35%.
“This incremental investment in our associates was made possible by the new tax reform bill,” Chief Executive Officer Craig Menear said in a statement.
Home Depot joins Starbucks Corp., Wal-Mart Stores Inc., Apple Inc and other U.S. corporate giants in devoting some of their expected tax savings to employees. Still, the long-term benefit for workers is less clear. Many of the payouts have taken the form of one-time bonuses rather than permanent raises.
Home Depot also expects to pay an extra $150 million in tax expenses tied to offshore earnings. Together with the bonuses, the costs will cut profit by about 19 cents a share, the Atlanta-based company said.
Home Depot is still evaluating the effect of the tax changes on its fiscal 2018 finances, but it expects to see a “beneficial” impact. The company plans to provide full-year guidance during its earnings conference call on Feb. 20.