In March, we reported that General Electric made $5.1 billion in U.S. profits, yet managed to dodge paying any federal taxes. The data was based on a study conducted by Capital IQ and the NYT on companies between 2005 to 2009.Believe it or not, in 2010 GE had a tax rate of negative 76.6% on $4.2 billion in profits, according to a recent report issued by Citizens for Tax Justice and the Institute on Taxation and Economic Policy.
Another big dodger Pepco Holdings profits totaled $229 million and a tax rate of negative 118%.
The study examined 280 companies in the Fortune 500 that were profitable within the past three years and found that 30 of these companies have paid nothing due to tax subsidies and loopholes. In 2008, 22 companies paid no federal income tax and this number increased to 37 by 2010.
This is because certain tax codes implemented are geared specifically for companies to expand their businesses. For example, the oil and gas industry is able to write off massive drilling expenses. Tax laws also allow companies to write off capital investments before the assets are actually used up.
The report says:
Today corporate tax loopholes are so out of control that most Americans can rightfully complain, “I pay more federal income taxes than General Electric, Boeing, DuPont, Wells Fargo, Verizon, etc., etc., all put together.” That’s an unacceptable situation.
GE told us:
The report is inaccurate and distorted. GE paid billions of dollars in taxes in the United States over the last decade, and we expect our overall tax rate will be approximately 30% in 2011. We believe the U.S. tax system needs to be reformed to close all loopholes, to lower the corporate rate and to provide a territorial system like every other major country in the world.
Here are the other corporations that didn’t pay any income tax.
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