Hawaiian Airlines said Thursday that if the new federal corporate tax rate for 2018 were in place in 2016, the airline would have paid $38 million less in taxes.
The state’s largest carrier, which will announce its full-year 2017 financial results Jan. 29, said its estimated 2016 federal income tax liability was $95 million based on an income tax rate of 35 percent. The federal corporate tax rate will be reduced to 21 percent in 2018 under new rates that President Donald Trump signed into law Dec. 23.
Hawaiian said it doesn’t know what its tax liability will be in 2018 and won’t announce what its federal tax rate was for 2017 until later this month.
Hawaiian spokesman Alex Da Silva said that the airline will use the savings toward airport renovations.
“We are anxious to apply that toward airport renovations that will improve our guests’ experience and the work environment for our employees,” Da Silva said. “We plan to begin a significant renovation of our lobbies in Terminal 2 at Daniel K. Inouye International Airport. We intend to expand our space and add security lines to relieve the congestion our guests endure every day. This will require coordination with the state, as our landlord, and we have already begun working on that.”
He also said that in March the airline’s employees will receive profit-sharing payments for
the 2017 year that are among the highest in its company’s history. Hawaiian is one of the largest employers in the state with 6,759 employees.
“This program shares
5 percent of our pretax
income with part-time and full-time employees (excluding officers of the company),” he said. “It is our company’s way of recognizing the individual effort that is critical to our success. We also have a bonus program tied to our company scorecard and expect all of our employees to enjoy combined bonus and profit-sharing payments equivalent to more than two weeks’ pay.”
In late December Hawaii’s five largest banks responded to the corporate tax cut by offering most of their employees bonuses of either $1,000 or $1,500 and raising the starting wage.