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Corporations at Tax Time: Who's Good, Who's Bad, and Who's Very Ugly
It's tempting to blame government for our middle-income 15-20% tax rates. But the true culprits have documented their own guilt. Comprehensive financial reports called '10-Ks' are issued annually to the SEC by U.S. corporations. Amidst tedious pages of income, flow, and outgo, company accountants deftly balance management's desire to impress stockholders with the need to avoid self-incrimination.
PayUpNow.org has documented recent corporate tax activity from the 10-Ks. We took non-deferred federal tax payments over the past three years and analyzed the figures to determine which companies and industries consistently meet or avoid their obligations. The entire dataset is available on the PayUpNow.org website.
The GOOD seems to be in the health care industry, where Humana, Medco, Wellpoint, and United Health all paid taxes at rates close to the 35% corporate maximum over the past three years. Some nation-wide family favorites fared well, too. Home Depot, Walgreens, CVS, Kohl's, and Best Buy all approached the 35% rate three years running. Good places to shop.
Companies within specific industries were generally grouped together, as if they didn't want to fall far from the tree. In the middle of the pack were Costco, Walmart, and Target, all consistently paying in the mid-20% tax rate range. Even more noteworthy was the tech industry, which had several companies paying taxes at annual rates between 15 and 20 percent: Microsoft, Oracle, Dell, Google, Apple, Amazon, Cisco, and Comcast.
On to the BAD...Kraft Foods and Coca Cola paid less than 10% in taxes over the three-year period. Chevron paid 5%. Hewlett-Packard 3%. IBM 2%. Exxon 2%. Carnival 1%.
Can't get much worse, it seems. But it does. It gets UGLY.
Boeing and DuPont and Dow Chemical and Verizon all made profits three years in a row, but all received net refunds for the three-year period. The ugliest result comes from General Electric, which made pre-tax profits of $44 billion over three years but received almost $5 billion in refunds! So ugly, indeed, that the company buried its tax benefit (refund) strategy in a nondescript passage near the end of its 10-K.
The big picture:
The top 100 companies, with $5 trillion in 2010 revenue and $500 billion in pre-tax earnings, paid less than 10% last year in non-deferred federal taxes. If these 100 companies had paid the 35% tax designated by U.S. tax law, an additional $140 billion would have been collected in federal taxes in just one year. This is approximately equal to the total budget deficits for all 50 states.
Pay Up Now is committed to a focused national effort to refuse the business of the worst corporate tax offenders. We should not have to subsidize them with our own tax money.
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9 Comments so far
Show AllThank you for the number crunching to prove to us what we already knew! (it might help in convincing others...)
Let's cease with the delusional "10-20%" tax rates lie. We. the middle-class and lower income earners pay WAY more than that in taxes. If glommed all together under a single banner, the tax rate for the non-rich is in excess of 50% certainly comparable to the euro-socialist countries' tax rates, but WE GET NOTHING in return.
Time to start starving the BEAST before it starves you, which is its intention, by the way.
We must also face the facts that current tax laws allow for publicly traded corporations to escape any tax burden. Shareholders, at least some/many of them, expect their return on investment to be maximized. Corporations are legally obliged to find legal means to maximize profits. Paying lots of money to lawyers and accountants is nothing compared to the savings which these corps. can show to their profit hungry shareholders.
Until shareholders and stakeholders take a stand against corporate personhood, we will not see a change. Articles like this one are informative, but who is going to write the strategic plan to change he status quo on corporations and the power they wield in the world?
Common Dreams really needs to stop printing blindered pap without first reading it. How are Home Depot and Best Buy, to take two examples, "good" corporations when they're notoriously antigay in their employment practices? And am I the only one here whose gorge rises when someone declares health care corporations "good" in any context?
A corporation isn't "good" for paying its taxes. One doesn't become "good" by doing what one is supposed to do.
I don't want them to stop printing stuff like this. Let's get it out there and give people a shot at answering back. That's what Free Speech is all about.
I had much the same thought, corvo.
The author could've employed a comparable strained metaphor, e.g.
"Corporate Tax Time Olympics: Who's Gold, Who's Silver and Who's Very Tarnished Bronze". I doubt if he intends or expects the labeling to be taken as a general accolade.
However, the "good places to shop" suggestion is annoyingly gratuitous and insipid. It's preposterously facile to suggest that one ought to approvingly patronize (reward) predatory corporations because they appear to be paying their arbitrarily skewed and contrived "fair share" of taxes.
Exactly. That "good places to shop" line pissed the hell out of me. And that in addition to the fact that stepping inside a Best Buy is right up their with unanesthetized root canal surgery: the minute you walk in, a swarm of blue polo shirts, all desperate for commissions, zeroes in on you . . .
If the IRS collected all the unpaid taxes by corporations and the rich and the USG stopped the warmongering, within a couple of years, the US would be on top of the game again with universal healthcare, no debt and a brand new infrastructure. How sweet it would be! But, hey, I realize that no matter what, the wars must rage on and the little people must pay for them.
I'm curious, I just read another article that looked at corporations taxes for last year and their findings were drastically different from yours. Why is this? The article is here http://www.forbes.com/2011/04/13/ge-exxon-walmart-apple-business-washington-corporate-taxes.html
I'm honestly very curious because you state that Exxon paid 2% taxes over the last three years while the aforementioned article claims Exxon paid 45% the last year. Has there really been that much variance over the last three years? I don't know who to believe in the age of misinformation. I'm posting the same comment on the other article too and hoping someone can shed some light on for me. Thanks.