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How Corporations Get Out of Paying Taxes

HOW In the 1950s, corporate taxes accounted for 30% of all federal revenue. Nowadays, they account for just 6.6%. This is because corporations have become masters of tax minimization. Earlier this year, GE became the poster child for these shady practices. Here is how GE- and other corporations like them - manage to do it. CORPORATIONS GET OUT OF PAYING TAXES FOREIGN SUBSIDIARIES THE WORLD'S TAX HAVENS Zug, SWZ Tax: 15-16% Gen. Pop.: 26k US Co. Pop.: 30k US Corporate 35% 2 highest Tax Rate: rate in the world Dublin, IRE Тах: 12.5% Gen. Pop.: 1M US Co. Pop.: 600 Corporations work around this by opening subsidiaries. In foreign subsidiaries, US companies have: $1.2 TRILLION 8% OVERSEAS U.S. GDP That's enough to cover 2011 defense & health care costs. 83 OE 100 largest U.S. corps. have subsidiaries in tax havens Foreign subsidiaries alone aren't enough. Since there G.E. is commonly referred to as "The world's best tax law firm." are still billions in the states, corporations have to exploit loopholes in the tax code to max- CREATIVE ACCOUNTING imize profit. OVER PAST FIVE YEARS $4.1B enefits. in net tax Y75 employees from the IRS and Treasury work for GE. Instruction to employees: "Look to exploit opportunities to Equivalent to proposed IRS budget cuts. reduce tax." Congress occasionally tries to sew up these loopholes. That's why the next weapon in every corporation's arsenal is lobbying. LOBBYING BUDGETS GE O EXXON HOUSE WAYS& MEANS COMMITTEE is the target of lobbyists. It is in charge 100M 200M G.E. has spent the most of any U.S. company on lobbying over the past decade (200M). of all U.S. taxation AMERICAN JOBS CREATION ACT 2004 > Co-written by GE > $13B per year in tax breaks for corporations >Enough to pay 100% of the U.S. energy budget each year CHARLIE RANGEL Chairman of the House Ways & Means Committee "til 2010 - Dropped opposition to corporation tax breaks in 2007 after GE agreed to LOBBYING give money to NY schools. The last stage in the process, when all the hard work has paid off. Here are the profiles of a few of our nation's most successful tax dodgers. Google Microsoft CISCO Tax Rate: Tax Rate: Tax Rate: Tax Rate: 3.6% 2.4% 20% 26% Pre-Tax Profit: Pre-Tax Profit: Pre-Tax Profit: Pre-Tax Profit: $14.2 bilion $10.8 olion $7.7 bmion $10.8 billion $7.7 bilion $25 bilion 8 companies in Ireland. Savings is more than $100 million $3.2 billion Overseas Business savings in 2010. accounted for 26% of savings in 2009. per year. PROFITS It's unclear how to remedy this situation, as significantly lowering the corporate tax rate - as American corporations want the government to do - would cost the US government trillions of dollars. Until loopholes are fixed and lobbyists are resisted, corporations are going to keep raking it in; and the government is going to keep shelling it out. Created By References: r-1,2817,2382706,00.asp,2817,2371335,00.asp;photovideo 15440

How Corporations Get Out of Paying Taxes

shared by youcom on Dec 28
In the1950's corporate taxes accounted for 30% of federal revenue and today they account for 6.6%, so what has happened? This infographic takes a look at the loop holes that corporations use to get ou...


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