Sunday, October 27, 2013

Over 10% of US largest firms pay no tax...

There are 57 separate companies listed on the index that paid a zero percent rate from the past year. Those companies include both household names like Verizon and News Corp. and lesser-known corporate giants like the data storage manufacturer Seagate (market value $15.9 billion) and Public Storage (market value $29.5 billion). Many of the companies USA Today identified in its analysis as paying negative rates make the list because they lost money, but several were profitable. Previous analyses have shown that the typical corporation pays a lower effective tax rate than most middle-class families, and a far lower one than the statutory corporate tax rate against which business interests disingenuously rail.

Getting to a zero percent tax rate despite turning a profit requires creative accounting, but not lawbreaking. The corporate tax code allows companies to avoid tax liability even in years when they turn a profit. Some of the profitable companies on the newspaper’s list, such as General Motors, achieved a zero percent rate by banking tax credits from previous years when business was bad. But the more common gambit involves moving revenues from parent companies to offshore subsidiaries based in tax haven countries in the Caribbean, Europe, and elsewhere.

Such offshoring of profits has caught the attention of policymakers in the United States and Europe this year, with the focus predominantly on Apple Inc. The US tech giant not only avoided the American tax system, but managed to shelter about $100 billion in revenues from any taxes at all. That scheme relied upon a loophole in Irish law which that country’s government says it intends to fix, but the narrow change proposed by Ireland’s finance minister will not address the larger problem of corporate tax avoidance. Full story...

Related posts:
  1. America's richest families avoid paying taxes...
  2. Apple dodges all taxes in the UK ... again!
  3. 'Prince Charles is paying a lower rate of tax than his servants'
  4. Apple avoids taxes on $74 billion with ‘complex web’ of offshore entities...
  5. 'Google is cheating British taxpayers out of millions...
  6. Energy giant npower has dodged paying up to £108 million tax in the past four years...
  7. Facebook to pay NO tax for 2012 and will even get tax refund of $429m...
  8. Citigroup hasn’t paid taxes in 4 years, got $2.5 trillion from feds...

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