While the public debate focuses on whether, because of growing government debt, teachers and other government employees should give up part of their pensions, many corporations have been getting away with paying far less than their share of income taxes.

 

As a case in point, after a long lobbying battle with its European archrival, Boeing won a $35 billion contract from the U.S. Air Force to build a fleet of aerial refueling tankers—despite the fact that the company paid virtually no income taxes over the past three years.

 

Following the Air Force announcement that Boeing beat out EADS (European Aeronautic Defense and Space) for the lucrative deal, Citizens for Tax Justice issued a statement showing how little tax the U.S. defense contractor paid while reaping billions in profits.

 

According to Citizens for Tax Justice, Boeing reported $4.4 billion in pre-tax profits last year but paid only 0.3% of its pre-tax income in federal income taxes. The year before it reported $1.5 billion in pre-tax profits, but paid no federal income tax at all and actually claimed an outright tax rebate of $132 million. In 2008, Boeing reported $3.77 billion in pre-tax profits and paid a 1.2% federal income tax rate. Thus, for the three-year period, Boeing earned pre-tax profits of $9.7 billion, but paid an effective tax rate of -0.8% and ended up with a net refund of $75 million.

-Noel Brinkerhoff, David Wallechinsky

 

Boeing’s Reward for Paying No Federal Taxes Over Last Three Years? A $35 Billion Federal Contract (Citizens for Tax Justice) (pdf)

After Winning Tanker Contract, Boeing Questioned on Tax Bill (by Bernie Becker, The Hill)

Corporations Have Easy Time Beating Tax Code (by Noel Brinkerhoff, AllGov)

Boeing Received $5 Billion in Illegal Government Subsidies (by Noel Brinkerhoff, AllGov)