For Immediate Release
CEOs Who Earn More Than Their Corporations Pay in Taxes
WASHINGTON - Of last year’s 100 highest-paid U.S. corporate chief executives, 25 took home more in CEO pay than their company paid in 2010 federal corporate income taxes, according to a new report from the Institute for Policy Studies.
Executive Excess 2011: The Massive CEO Rewards for Tax Dodging, the Institute’s18th annual compensation report, details “the pernicious impact of hundreds of millions of dollars spent lobbying for corporate tax loopholes and shifting profits to offshore tax havens,” says report co-author Chuck Collins.
“Instead of sharing responsibility for addressing our nation’s fiscal challenges,” notes Collins, a senior scholar at IPS. “Corporations are rewarding CEOs for aggressive tax avoidance.”
The 25 tax-dodging CEOs the IPS report spotlights averaged $16.7 million in pay last year, well above the $10.8 million S&P 500 CEO average. Most of their companies registered substantial profits. Yet these same companies actually came out ahead at tax time. They collected, on average, $304 million in refunds from the IRS.
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PRESS CONFERENCE CALL: 11:00 AM ET; Wednesday, August 31, 2011 Dial-in: 712-432-0075; Passcode: 385784. On the press conference call, report co-authors Chuck Collins and Scott Klinger will discuss their report findings and answer reporters' questions about the report.
Low Taxes, Despite High Profits: The 25 firms that paid their CEOs more than Uncle Sam last year reported average global profits of $1.9 billion. Only one reported negative global returns. Only seven of the 25 companies reported losses in U.S. pre-tax income.
Extensive Use of Tax Havens for Tax Avoidance: Eighteen of the 25 firms operate subsidiaries in offshore tax havens, for a combined total of 556 tax haven subsidiaries. Of the seven companies that reported losses in U.S. pre-tax income, five have a combined total of 267 tax haven subsidiaries and a sixth, Nabors Industries, is headquartered in Bermuda.
Bigger Checks for Influence-Peddling than to the IRS: Of the 25 companies that paid their CEO more than Uncle Sam, 20 also spent more on lobbying lawmakers than they paid in corporate taxes. Eighteen gave more to the political campaigns of their favorite candidates than they paid to the IRS in taxes.
Gap Between CEO and Worker Pay Jumps: S&P 500 CEOs last year collected $10.8 million in average compensation, a 27.8 percent increase over 2009. The gap between CEO and average U.S. worker pay rose from 263-to-1 in 2009 to 325-to-1 last year.
“These 25 companies are extreme examples of how large corporations can get away with picking Uncle Sam’s pocket,” says IPS Associate Fellow and report co-author Scott Klinger. “And while the CEOs clearly benefit, working and middle class families and small businesses are left to pick up the tab.”
EXECUTIVE PAY REFORM SCORECARD
This year's Executive Excess report includes an updated scorecard which rates pay reforms that have been recently enacted, as well as those that are pending in Congress and a few that are not yet on the table.
Report co-authors include veteran compensation analysts Sarah Anderson, Chuck Collins, Scott Klinger, and Sam Pizzigati. Their explosive 2010 report on CEO pay among layoff leaders is available at: http://www.ips-dc.org/reports/
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