An infuriating post about corporate tax cheats

Posted by AzBlueMeanie:

I recently received a letter from the IRS kindly informing me that I made a miscalculation and that I owe them a small sum of money (less than the cost of a tank of gas). I totally disagreed, but I paid it anyway because the small amount was not worth the aggravation and cost of postage and long-distance phone calls.

I was already in a bad mood and primed for a fight over this injustice when I read this article, and now I am really pissed off! Rick Ungar writes at Forbes Magazine, How Our Largest Corporations Made $170 Billion During Great Recession And Paid No Taxes:

Yesterday, I wrote about how the GOP is falsely pushing the argument that America’s corporations are overtaxed. I included some great data courtesy of conservative commentator Bruce Bartlett whose New York Times piece did an extraordinary job of putting the lie to the Republican assertions.

Today, and not a moment too soon, the non-profit Citizens For Tax Justice (CTJ) has put out their findings revealing that twelve of the nations largest Fortune 500 companies, while making $170 billion in profits during the period of The Great Recession, paid an effective tax rate of negative 1.5%.

Yes, you read that correctly.

Not only have these twelve companies paid zero in taxes for the years 2008-2010, they actually received tax subsidies that added $62.4 billion to their bottom lines.

The companies were chosen by the CTJ to represent a range of industries, including manufacturing, energy, services, transportation and high tech and include – in alphabetical order – American Electric Power, Boeing, Dupont, Exxon Mobil, FedEx, General Electric, Honeywell International, IBM, United Technologies, Verizon Communications, Wells Fargo and Yahoo.

Here are the bullet points presented by the report:

• From 2008 through 2010, these 12 companies reported $171 billion in pretax U.S. profits. But as a group, their federal income taxes were negative: –$2.5 billion.

• All but two of the dozen companies enjoyed at least one no-tax year over the 2008-10 period, despite reporting substantial pretax U.S. profits in those no-tax years.

• Eight of the twelve companies reported net tax benefits over the full three-year period.

According to the study, not a single one of these companies paid an amount even close to the 35% statutory tax rate.

In fact, the tax rate paid by Exxon Mobile, when spread over the full three years, was only 14.2% – a full 60% below the 35% rate that corporations are supposed to be paying.  And if we take a look at what Exxon paid over just the past two years, it totals a mere 0.4% on their pre-tax profits of $9.9 billion.

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Here is my favorite part – had just these twelve companies paid at the actual 35% tax rate the GOP is telling us they are chaffing under, the sum would have added a full 12% to the totals the United States of America’s treasury received through corporate taxes.

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Take a look at this chart, provided courtesy of Thinkprogress.com, and be amazed.

What I don’t know is whether or not the preponderance of American corporations are getting away with the same kind of tax avoidance that these twelve companies are managing to pull off.

Bob McIntyre, director of Citizens for Tax Justice, seems to believe that they are.

These 12 companies are just the tip of an iceberg of widespread corporate tax avoidance. Our elected officials have a duty to the American public to make reducing or eliminating the vast array of corporate tax subsidies the centerpiece of any deficit-reduction strategy.

McIntyre is certainly right when he points out the duty of our elected officials. But they are not the only ones with such a responsibility.

We, as voters, also have a duty to react when the GOP majority in the House of Representatives tries to tell us we need to reduce this phantom corporate rate from 35% to 25% so that these corporations can pay even less in taxes while they pocket even greater amounts of taxpayer money via corporate subsidies.

Worse still, Boehner, Ryan and friends have the unmitigated gall to make their pitch while asking the rest of us to give up the social programs that are so essential to most Americans.

Seriously, people, do we need an anvil to fall on our heads before we get it?

Continue reading Rick Ungar – The Policy Page.

Why should I have to pay a little more when multi-billion dollar multi-national corporations pay no income taxes at all and even get a freakin' refund (subsidy) from the government? Prosecute these corporate tax cheats!