Corporate Tax Rate Too High? Not for GE…2.3% over 10 Years
Thursday, March 01, 2012
General Electric CEO Jeffrey Immelt and Barack Obama (AP Photo)
Indicative that something is amiss with the corporate income tax system, General Electric over the last 10 years paid only 2.3% tax on more than $81 billion in profits, according to the advocacy group Citizens for Tax Justice.
It was revealed last year that GE paid no federal income taxes in 2010. In fact, it received $3 billion in net tax benefits for that year. GE officials insisted the company didn’t owe anything for 2010, but added that for 2011, things would return to “normal” come tax time.
But what’s normal for GE is different from what’s normal for most Americans. Citizens for Tax Justice claims the corporation’s “effective federal income tax rate” was only 11.3%, less than a third of the official 35% corporate tax rate.
“I don’t think most Americans would consider 11.3%, not to mention GE’s long-term effective rate of 2.3%, to be ‘normal,’” said Bob McIntyre, director of Citizens for Tax Justice. “But for GE, taxes are something to be avoided rather than paid.”
Citizens for Tax Justice studied 280 major corporations and discovered that, for the years 2008-2010, the average effective tax rate was 18.5% rather than the 35% that big businesses and their Congressional supporters have been complaining about. Twenty-nine of the companies actually had a negative tax rate over the three-year period. This was most often the case with companies in the energy industry, such as Pepco, PG&E, NiSource, CenterPoint Energy, Atmos Energy, Integrys Energy and American Electric Power. Wells Fargo, Verizon, Boeing and DuPont also had negative tax bills.
-Noel Brinkerhoff, David Wallechinsky
To Learn More:
Press Release: General Electric's Ten Year Tax Rate Only 2.3 Percent (Citizens for Tax Justice)
Corporate Taxpayers & Corporate Tax Dodgers 2008-10 (by Robert S. McIntyre, Matthew Gardner, Rebecca J. Wilkins and Richard Phillips, Citizens for Tax Justice & the Institute on Taxation and Economic Policy) (pdf)
25 Major Companies Paid More to CEOs than They Did in Taxes (by Noel Brinkerhoff and David Wallechinsky, AllGov)
General Electric Doesn’t Pay Taxes; Why Should You? (by Noel Brinkerhoff and David Wallechinsky, AllGov)
Why Did Obama Choose Outsourcing Champion Jeffrey Immelt as Jobs Advisor? (by Noel Brinkerhoff, Allgov)
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