Lawmakers link shrinkflation to corporate tax cuts

Shrinkflation and Taxes

A pair of congressional Democrats is demanding answers from top food producers on why they opted to reduce product sizes—and linking the practice to lower tax rates paid under the 2017 tax law.

“The 2017 Republican corporate tax cuts were sold with ‘trickle down’ arguments about benefits to consumers, but these tax breaks actually incentivized price gouging,” Sen. Elizabeth Warren (Mass.) and Rep. Madeleine Dean (Pa.) wrote to executives at Coca-Cola, PepsiCo and General Mills.

Citing data on effective tax rates from the left-leaning Institute on Taxation and Economic Policy, Warren and Dean asked the companies for ...