September 8, 2021
Dems Float Federal “Pay Ratio” Tax
I’ve blogged a few times about “pay ratio” tax proposals – mostly at the state level. Although they haven’t really taken off, this CNBC article and other sources say that Democrats are currently revisiting the idea – along with a number of tax measures that could affect executive compensation.
It’s good to be aware of this in case the comp committee or an executive asks about it, but know that it’s all pretty speculative at this point as lawmakers try to gather support for the budget bill and social spending proposals. Ideas on the table include:
– Taxing stock buybacks, or treating them as taxable dividends to shareholders
– Reducing corporate deductions for executive compensation
– Pay ratio excise tax
Our “Pay Ratio” Practice Area includes memos about state efforts to reign in executive pay and promote pay equity.
– Liz Dunshee