You pay so they won't have to: corporate non-taxation

[Hannah Bell]

From 1996 through 2000, just ten large profitable companies enjoyed a total of $50 billion in corporate tax breaks. That brought their combined tax bills down to only 8.9 percent of their $191 billion in U.S. profits over the five years. In just the most recent two years for which data are available, these ten companies got $29 billion in tax welfare, and paid a mere 5.9 percent of their profits in federal income taxes.

Microsoft enjoyed more than $12 billion in total tax breaks over the past five years. In fact, Microsoft actually paid no tax at all in 1999, despite $12.3 billion in reported U.S. profits. Microsoft’s tax rate for the past two years was only 1.8 percent on $21.9 billion in pretax U.S. profits.

General Electric, America’s most profitable corporation, reported $50.8 billion in U.S. profits over the past five years, but paid only 11.5 percent of that in federal income taxes. That low tax rate reflected almost $12 billion in corporate tax welfare for GE.

Ford enjoyed $9.1 billion in corporate tax welfare over the past five years. It reported $18.6 billion in U.S. profits over the past two years, but paid a tax rate of only 5.7 percent.

Worldcom paid no taxes at all in two of the last three years, despite reported U.S. profits of $15.2 billion. Worldcom’s total tax rate over the three years was only 1.6%. Corporate tax welfare slashed Worldcom’s tax bill by $5.3 billion over the past five years.

IBM reported $5.7 billion in U.S. profits in 2000, but paid only 3.4 percent of that in federal income taxes. In 1997, IBM reported $3.1 billion in U.S. profits, and instead of paying taxes, got an outright tax rebate. Over the past five years, IBM enjoyed a total of $4.7 billion in corporate tax welfare.

General Motors paid no taxes at all in three of the last five years, despite $12.5 billion in reported U.S. profits. GM’s tax rate for the past three years was negative 1.3 percent. Its corporate tax welfare totaled $3.6 billion over the past five years.

Enron paid no income taxes at all in four of the past five years, despite $1.8 billion in reported U.S. profits. Enron’s total taxes over the five years were a negative $381 million. Its corporate tax welfare totaled $1.0 billion.

El Paso Energy reported $1.6 billion in U.S. profits over the past five years, but paid less than nothing in federal income taxes, getting tax rebates of $254 million. El Paso’s tax rate over the five years was negative 15.5 percent. Its corporate welfare totaled $827 million.

Colgate-Palmolive paid no taxes at all in three of the past five years, despite $1.6 billion in reported U.S. profits. Colgate’s total tax rate over the five years was negative 1.3 percent, due to $595 million in corporate tax welfare.

Navistar (formerly international harvester), on $1.4 billion in U.S. profits over the past five years, paid only $28 million in federal income taxes, a tax rate of only 2 percent. Navistar’s corporate tax welfare totaled $451 million.

http://www.ctj.org/html/corp0402.htm


There's something very interesting about most of the companies on this list.

[SmileyRose]

1. I'd love to get rid of corporate taxation all together.

Along with that would come the loss of "personhood" and the rights to own property and influence government.

Never happen.......

[Hannah Bell]

3. I'm just surprised to see Microsoft on that list. Being as how bill gates supports higher taxes on

rich people, you know.....

[unblock]

10. never heard that from *that* bill gates. it's his father (bill gates, sr.) who's vocal about that.

don't know if junior has ever said anything about it.

[samplegirl]

2. I argued this with a Wingnut and this is what she told me...

250 Billion or hundreds in Assets has NOTHING to do with how much you pay in taxes (Unless you are talking PPT on Inventory which Ohio does not have anymore). Income tax for corporations (see IRS Form 1120) is Gross Revenue less returns/allowances less cost of goods sold less FOH less other expenses equals Income before taxes and debt, take off debt (only the interest portion for taxes) gives you your Corporate Adjusted Gross Income - THAT IS THE AMOUNT YOU PAY TAXES ON!! You can still have assets but no AGI. Agian check with the IRS for Form 1120.

[Hannah Bell]

7. who said anything about assets?

Microsoft actually paid no tax at all in 1999, despite

*$12.3 billion in reported U.S. profits*

Microsoft’s tax rate for the past two years was only 1.8 percent on

*$21.9 billion in pretax U.S. profits*

[liberal N proud]

4. But this is not what the teabaggers are upset about

[Mari333]

8. when they are specifically asked they respond with Randian efficiency

about how it is good for rich people to be rich etc

they love their overlords.

in the meantime, Microsoft and other companies not paying taxes use slave labour to prop up their short term profits.

[patrice]

5. K & R

[xchrom]

6. Recommend

[Statistical]

9. I know this is radical but here goes: I would support no corporate tax...

I would support no corporate tax if shareholders are taxed fully at fair rates and without any deductions or exemptions for that income.

The purpose of corporation is to pass profits to shareholders. Simply tax them at the destination. Corporations sole gole is to funnel money from consumer to the shareholder. They are a wealth transfer mechanism. Why tax money halfway through the mechanism. Eventually profits get to shareholder so just tax them there.

It would eliminate the "game" where big companies have an advantage over small ones because they can lobby, manipulate, and swindle tax breaks while small companies lack the resources. Hence GE pays 1% effective tax rate but Joes Hardware is paying 27%.

1) So get rid of this 10% to 15% on capital gains & dividends. If you are in 40% bracket then dividends are 40%.
2) Make tax brackets more progressive. +2% to +3% for highest brackets. +1% to middle ones.
3) Add two new "super brackets" (say at $1 million @ 47% and $10 million @58%) to keep up with the times of super high income.
4) Treat all income the same

If we did all that the income taxed at the investor level would be very progressive. At that point I say scrap the ENTIRE corporate tax structure. No need to tax the funnel if you tax the investor at the end of it.

I doubt that will ever happen but seems far simpler and less likely to result in fraud.

[proudohioan]

11. Good points! I like radical......

and it makes sense, too, as I firmly believe, when we're talking about that kind of "income", it's not so much about the money, but the game....