New Jersey Rep. Bonnie Watson Coleman, who’s making ready to retire on the finish of her time period in 2026, lately reintroduced a invoice designed to shift a little bit of financial energy again to staff.
The invoice, often known as the federal “Worker Revenue Sharing Encouragement Act of 2025 (H.R. 6418),” at present beneath evaluation in committee, would require giant firms with annual income exceeding $25 million — firms like Walmart, Amazon, ExxonMobil, UnitedHealth Group, Apple, and CVS — to share a minimum of 5% of their internet earnings with their full- and part-time staff. Firms that fail to create such a profit-sharing plan would lose their deductions for govt compensation.
“Roughly 51 p.c of American staff — about 65.4 million people — work for firms with income over $25 million and would profit from profit-sharing,” a press assertion from Watson Coleman’s workplace states. “The invoice exempts 99.7 p.c of American firms to make sure no small companies are held to an unmanageable customary.”
One good motive for the invoice, the congresswoman stated, is that the wage hole between employers and staff is widening. She spoke about how firms have been capable of dole out elevated earnings to their executives and shareholders whereas holding the wages of their common staff the identical. “Our tax code is riddled with giveaways for companies,” Watson Coleman stated, citing loopholes reminiscent of offshore borrowing and questionable manufacturing deductions. “It’s time for Congress to step in and make sure that firms put money into their staff.”
If H.R. 6418 is authorized, it might affect the tax legal guidelines that apply to staff and the way companies pay their employees. Worker revenue sharing is when a enterprise instantly provides a part of its earnings to its employees, normally as a bonus or retirement profit, based mostly on how worthwhile the enterprise is. The profit-sharing plans will be tied to retirement accounts, and the IRS at present limits contributions to $69,000 or 25% of an worker’s compensation in 2024.
This invoice carefully resembles a earlier one the congresswoman proposed, H.R. 2628 from 2023, which additionally tried to hyperlink company tax breaks to employee advantages. H.R. 2628 was not enacted; it was launched and referred to the Home Methods and Means Committee however didn’t endure particular committee markup or hearings throughout the 118th Congress.
