Chief executive officers are poised to collect an additionalretirement windfall if President-elect Donald Trump succeeds in cutting the taxes ofthe highest U.S. earners, according to a new study.

The CEOs of Fortune 500 companies, who had accumulated almost $3billion in tax-deferred accounts at the end of 2015, will owe theInternal Revenue Service about $990 million if the topfederal tax rate is reduced to 33 percent, or$180 million less than they’d currently pay, the Institute forPolicy Studies, a liberal think tank in Washington, said in a studyreleased Thursday.

While rising executive pay and widening inequality across incomegroups have drawn increasing attention in the U.S., less has beenmade of the large gap in retirement savings, the authors say. Just 100CEOs have accumulated retirement savings equal to the entireretirement accounts of 41 percent of U.S. families -- or more than116 million people, according to the report.

“During the presidential campaign we heard the frustrations ofworkers about loss of jobs and security for old age, so it’sdisturbing to see the growing CEO-to-worker retirement gap,” saidSarah Anderson, co-author and the institute’s global economyproject director. “CEOs with tax-deferred accounts have beengambling that the tax rate will go down before they withdraw theirsavings, and now that is likely to happen.”

The bulk of CEO retirement savings is in deferred-compensationplans that permit executives to set aside salaries, bonuses and insome cases stock awards on a pretax basis. Because they only paytaxes when they withdraw the funds, they’ll benefit if the maximummarginal tax rate is lowered to 33 percent from the current 39.6percent, as Trump has proposed.

Ending ‘dodge’

Trump’s team says his plan benefits all Americans, including theworking class. It ensures the rich pay “their fair share” butnot enough to undermine job growth or U.S. competitiveness,according to the campaign website. Arthur Laffer, who served onPresident Ronald Reagan’s economics team, agrees.

“The tax cuts done correctly will benefit everyone andstrengthen the economy -- and executives will stop spending timetrying to dodge the rate with things like tax-deferred plans andspend more time working,” said Laffer, chairman and president ofLaffer Investments in Nashville, Tennessee.

Glenn Renwick, who led Progressive Corp. as CEO for almost16 years before stepping down recently, is at the top of thestudy’s list with tax-deferred retirement savings of $194.4million. Last year alone, Renwick, who’s still chairman, set aside$24.7 million in his tax-deferred account.

Workers at the Mayfield Village, Ohio-based insurance companyare eligible for a 401(k) plan that includes a 100 percent matchingcontribution at up to 6 percent of income, for a maximum of$12,000.

‘Objective, measurable’

“Our executive-compensation plan is tied to our companyperformance and based on objective, measurable criteria whichaligns our executive interests with those of shareholders,” BrianGrace, director of communications, said by e-mail. “Regarding our401(k) program, we believe in investing in our employees’future.”

Unlike ordinary employees with 401(k)s, who can only set aside$18,000 a year of their own pay and an extra $6,000 if they’re 50or older, top executives can often place unlimited amounts inspecial deferred-compensation plans. Some companies offersweeteners including supplemental executive retirement plans.

Michael Neidorff, the chairman, president and CEO of CenteneCorp., a provider of health plans to Medicaid recipients and otherlow-income Americans, saw the biggest gain in his retirementsavings over five years, according to the study. He had $139.2million in his deferred-compensation account at the end of 2015, asevenfold jump from 2010.

Centene representatives couldn’t immediately be reached forcomment.

“These deferred-compensation plans make visible the high-levelwealth that CEOs can accumulate, sometimes over long careers,” saidGary Hewitt, a director at Sustainalytics, an Amsterdam-basedcorporate governance and investment research firm. “And CEOs takeadvantage of these plans because they believe they’ll be taxedlower when they withdraw their money than when they put it in.”

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