Central Bancompany will give employees bonuses of $1,000 or $500 because of the recent tax overhaul passed by Congress.
The company announced Friday it plans to give the bonuses to reward employees and show them the company's gratitude. The company joins dozens of businesses across the country in giving employee bonuses after Congress passed a sweeping tax cut for businesses and individuals.
President Donald Trump signed a bill Dec. 22 overhauling the nation's tax code. One of the biggest changes included in the bill cuts the corporate tax rate from 35 percent to 21 percent. The bill also restructures and lowers the seven personal income tax brackets.
Based in Jefferson City, privately owned Central Bancompany announced the bonuses in a news release Friday afternoon. Full-time employees will receive a $1,000 bonus, and part-time employees will receive a $500 bonus.
"The economic development that should ensue as a direct result of the new tax reform legislation will positively affect the communities we serve," CEO Bryan Cook said in a news release. "We are excited for the opportunity to reward our dedicated and hard-working employees with this special bonus as a token of our gratitude."
Withholdings of $13 billion, 13 community banks comprise Central Bancompany. The company has more than 250 branches and 2,500 employees in 66 communities throughout Missouri, Kansas, Illinois and Oklahoma.
When Trump signed the bill, a handful of large companies started the trend of issuing $1,000 bonuses to employees because of the tax reform package. AT&T was one of the first companies to publicly announce plans to reward employees with the bonuses. So far, about 19 other companies on the Standard & Poor's 500 Index and airlines like Southwest Airlines, JetBlue Airways and American Airlines announced similar plans.
More than 100 companies nationwide have given out bonuses because of the tax cut, according to the conservative-leaning Washington Examiner.
Other companies announced plans to raise wages because of the tax bill. Wells Fargo announced in late December that it plans to raise its minimum wage nationwide to $15 per hour because of savings from the bill.
Despite the rash of companies issuing bonuses in the short term, economists and financial analysts remain split on whether middle-class Americans will benefit from the tax bill in the long run. Some think much of the proceeds may go back to shareholders through stock buyback programs and dividends.
Chad Horton, a financial adviser with Wells Fargo Advisors' Jefferson City office, said Monday that use of the savings will vary from company to company.
"It's basically going to be what each business decides is best for each business," Horton said.
Still, Horton said employees will see benefits regardless of how companies use the funds as wages increase and the economy grows.
"Employees will continue to see benefits whenever your business grows stronger," Horton said.