Howard Schultz, Starbucks executive chairman, voiced out concerns against the corporate tax rate cut in the U.S. without also tackling more extensive tax reform.
Schultz discussed in an interview that, “You can’t have a corporate tax cut without having a transformation in complete tax reform.”
He also said that, if there will be a corporate tax cut that will add to the national debt, then he thinks that “it’s a mistake.” Proceeding to point out that tax reform isolation through corporate tax cut and simply “leaving it there” is not possible.
Schultz also said that if the U.S. President Trump’s corporate tax cut proposal from 35 percent to 20 percent does end up going into effect, the savings the businesses will get should be used to benefit their employees.
“I would hope that [businesses] would use it in ways that would advance their employees, to work what we need to do at our communities and building a better society,” he stated, adding that Starbucks will be taking this action.
A report showed that Starbucks’ fiscal third quarter saw them paying an effective tax rate of 34.3 percent.
An analyst said that, “In addition to cutting corporate tax rates, President Trump’s proposed tax plan would reduce the number of personal income tax brackets from seven to three and nearly double the standard deduction for individuals and married couples.”
Schultz stepped down as Starbucks’ CEO earlier this year, with many people wondering if he will pursue a career in politics. “I think about politics, but I have no intention of running for public office,” was his answer.
Starbucks’ “Brand Value” Rises
Schultz announced a little over a year ago that Starbucks’ primary goal was to get back on track, saying that he believed the company had “clear line of sight to returning our U.S. business to historic levels of comp sales growth [of 5% or more].”
Albeit it has taken over a year to accomplish, Starbucks’ domestic comparable-store sales increased 5 percent last quarter, as well as announcing some plans to enhance its store portfolio, accelerate long-term growth, and raise profitability ratio.
Even though Starbucks’ stock still has mostly unchanged trading rates, a brand consultancy survey – taking into consideration the branded services or products’ financial performance, the brand’s role in purchase decisions and competitive strength – showed that Starbucks’ “brand value” rose 16 percent over the past 12 months, soaring to $8.7 billion this year, moving past company’s such as Sony, Colgate and Morgan Stanley.
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