The Tax Excessive CEO Pay Act of 2025 would impose a corporate tax penalty on large companies where the CEO or highest-paid employee earns more than 50 times the median worker's salary. Companies would face an increased corporate tax rate ranging from 0.5 to 5 percentage points above the standard 21 percent rate, depending on how extreme the pay gap is—with the steepest penalty applied to companies with pay ratios exceeding 500-to-1. The bill applies to all publicly traded companies and large private corporations earning at least $100 million annually, while exempting smaller private companies. The penalties would take effect for tax years beginning after December 31, 2025, and Treasury would have authority to issue regulations preventing companies from manipulating their pay ratios through workforce restructuring, such as replacing employees with contractors.
Take Action
Your position
Add a comment
to comment on this bill.
Annotate the text
Highlight any passage on the Summary or Full Text tab to attach a note. Annotations appear on the Annotations tab.