WASHINGTON (Reuters) – Trump's $ 1.5 trillion tax cut package did not appear to have a major impact on companies' capital investments or hiring plans. This resulted in a survey published in more than a year, one year after the largest revision of the US tax code 30 years.
The NABE quarterly survey on business conditions revealed that some companies reported accelerated investment due to lower corporate taxes, but 84 percent said they had not changed their plans. Compared with 81 percent in the last survey published in October.
The White House had predicted that the massive stimulus package, marked by the reduction in corporate tax rates from 35 percent to 21
"A large majority of respondents (84 percent) say corporate tax reform, one year after their adoption, has not led their companies to change their hiring or investment plans," said NABE President Kevin Swift.
The lower tax rates, however, had an impact on the goods-producing sector: 50 percent of respondents from this sector reported increased investment in their companies, and 20 percent said they had diverted the hiring and investment to the United States abroad.
The NABE survey also indicated a further slowdown in business spending after slipping sharply in the third quarter of 2018. The measure of investment in the survey fell in January to its lowest level since July 2017. Investment expectations for The next three months also weakened.
"Fewer companies increased their investment compared to the responses from the October survey, but the decline seemed to focus more on structures than investments in information and communication technology," said Swift, who is also chief economist at the American Chemistry Council
According to the survey, employment growth improved slightly in the fourth quarter of 2018 compared to the third quarter, with slightly more than a third of respondents saying that employment in their companies had increased in the last three months (31 percent in the US) The predictive employment figures of the survey fell from 29 in October to 25.
(Report by Lucia Mutikani, Editor of David Gregorio)