Corporations love tax cuts, and Walgreens Boots Alliance Inc. (WBA) celebrated by increasing spending on employee wages.
The pharmacy chain announced that it will make investments totaling $150 million to boost wages for its in-store employees in fiscal 2019. The company also made the reason for the increased spending clear: the Trump tax cuts.
"We will be making select incremental investments of around $150 million in fiscal 2019, mainly in store wages, but also to fuel our new community health care initiatives, and you can view these in light of the favorable tax reforms in the U.S.," Walgreens Chief Financial Officer James Kehoe said during the company's fourth-quarter earnings call Thursday, Oct. 11.
The Trump administration passed tax reform that cut the corporate tax rate to 21% from 35% while also allowing a one-time tax-free window for the repatriation of overseas profits.
"We listened to our critics, thought hard about what we wanted to do, and decided we want to lead," said Jeff Bezos, Amazon's founder and CEO. "We're excited about this change and encourage our competitors and other large employers to join us."
Amazon has more 250,000 employees in the country and plans to hire another 100,000 seasonal workers this holiday season.