Rohrabacher Pushes Employee Ownership to Colleagues
WASHINGTON – Rep. Dana Rohrabacher wasted no time Wednesday pitching his employee ownership plan to colleagues as they gathered in Philadelphia for a Republican congressional retreat.
As many traveled together on a train from the nation’s capital, the Californian pressed his vision of worker empowerment on lawmakers looking for more ways to identify with working-class Americans.
Rohrabacher’s legislation, the Expanding Employee Ownership Act of 2017, would provide tax incentives to employees who are recipients of a company’s broad distribution of equal shares of voting stock granted to all employees. The stock would carry certain tax benefits provided the shares are held for a specified period of time. Earlier efforts to incentivize employee ownership were called Employee Stock Ownership Plans, or ESOPs.
The congressman dubbed his plan “ESOPs on steroids.” Unlike traditional ESOPs, however, the Rohrabacher plan would allow employees to own the stock granted to them directly, including all voting rights granted to any other stockholder.
“The legislation,” he said, “would make employers and employees partners rather than adversaries.”
Under the Rohrabacher plan, a stock would be exempt from all incomes taxes if held by the employee for five years. If held for 10 years, another provision would be triggered allowing the stockholder to sell the stock free from capital gains taxes over the next 10 years. After 20 years, the stock would be tax free. The plan also would ease the ability of individuals to sell their stock and roll the proceeds into other securities.
“What makes this bill especially attractive,” said Rohrabacher, “is that it is consistent with President Trump’s optimistic vision for America’s working people.”
The plan has been greeted enthusiastically by members of Congress on retreat for the remainder of the week.
Kenneth Grubbs, 202-225-2415