What Corporate Taxes?
For much of this year, legislators inside the beltway have been debating whether to lower the corporate tax rate, which currently can be as high as 35% for the biggest corporations in America. Some argue higher rates are a deterrent to companies doing business in the U.S., thereby costing us jobs, while others worry that lower rates mean losing much-needed federal revenue. But a new report may give pause to both sides. Citizens for Tax Justice, a nonprofit advocacy group, analyzed publicly available 2008-2010 federal tax filings for 12 leading Fortune 500 companies spanning the energy, technology and banking sectors and found that none of them incurred tax rates anywhere near the 35% mark. In fact, very few of the companies owed any taxes at all. These 12 companies reported more than $170 billion in pretax profits, and had they been kept to the 35% tax rate they would have owed the U.S. government $59.9 billion in taxes. Instead, the report notes, these companies collectively came out ahead by $2.5 billion thanks to a number of corporate tax subsidies. So if anything, the researchers argue, the problem is not too heavy tax burdens for major corporations, but too little. MainStreet combed through the data and ranked these 12 companies by the percentage of profits they paid in taxes between 2008 and 2010. In each case, the tax rates of these major corporations are significantly less than that of most U.S. households. Photo Credit: Chad Miller