Corporations Pushing for Tax Break Pay Little in Taxes
You may not have heard about “Win America,” because you’re not the target audience. This is a coalition of multinational corporations who want the federal government to enact another tax holiday for overseas corporate profits. This would allow these corporations to bring back money they illegally stashed in tax shelters overseas at a fraction of the tax liability. This repatriation holiday happened once in 2004, and the multinationals really loved that, so they want another one.
There’s an element of blackmail to this. In response to the tax holiday in 2004, corporations started stashing more money overseas. Then coalitions like “Win America” argue that they need a tax holiday to allow them to bring money back to the US for investment, thereby winning America. Of course, the 2004 tax holiday went largely to executive bonuses, but they want you to disregard that. They also don’t want you to know that the largest beneficiaries of the tax holiday in 2004 cut jobs over the next two years.
Think Progress reports that the corporations in this coalition have a history of… not paying their taxes.
However, many of the corporate supporters behind the WinAmerica campaign already use the various loopholes and giveaways in the corporate tax code to drastically lower their corporate tax rate. Here’s what these companies begging for a new corporate tax cut currently pay in corporate income taxes:
Corporation Effective Tax Rate* Apple 25% Broadcom 1.4% Cisco 19.8% Cognizant 16% 2.4% Microsoft 25% Pfizer 17.1% Oracle 27.1% Qualcomm 20%
One company not on that list is General Electric. However, we did learn today that GE, one of America’s largest corporations, which would be a beneficiary of any repatriation tax holiday, didn’t pay any taxes last year:
General Electric, the nation’s largest corporation, had a very good year in 2010.
The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.
Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion.
That may be hard to fathom for the millions of American business owners and households now preparing their own returns, but low taxes are nothing new for G.E. The company has been cutting the percentage of its American profits paid to the Internal Revenue Service for years, resulting in a far lower rate than at most multinational companies.
Wisely, the Obama Administration has wisely rejected the repatriation tax holiday idea, at least for the time being. But don’t expect them to say a whole lot about GE’s invisible tax liability. After all, President Obama just hired GE CEO Jeffrey Immelt to lead the President’s Council on Jobs and Competitiveness. I’m sure he has one idea to keep American companies competitive: don’t pay your taxes!