4:52 pm November 3, 2011, by Christopher Seward
General Electric Corp. caught a lot of heat this year after it was revealed the company paid no federal taxes on billions in profits, but a citizens tax reform group says it wasn’t the only one taking advantage of favorable tax loopholes.
Wells Fargo and Verizon Communications are also on a list with 27 other Fortune 500 corporations that paid no federal taxes in 2008, 2009 and 2010, according to Citizens for Tax Justice.
In a study on how corporations use federal tax loopholes to pay little or no taxes, the tax reform group said a study of 280 of Fortune’s 500 largest corporations found 30 paid no income tax during the three-year period.
Combined, the 280 companies had pretax U.S. profits of $1.4 trillion during the period, the study said.
While the official tax rate for corporations is 35 percent, the study found the effective rate for all 280 companies averaged 18.5 percent for the period. Calling it “good news”, the group said 71 companies, or 25 percent of the total, paid an effective rate of more than 30 percent.
Citizens for Tax Justice insists it’s not “an anti-business” report. “But we also need a much better balance when it comes to taxes. Just as workers pay their fair share of taxes on their earnings, so should successful businesses pay their fair share on their success. But today corporate tax loopholes are so out of control that most Americans can rightfully complain,“ the group says in the report.
The group is pushing an argument heard often from President Barack Obama and Democrats. Critics, however, say a much more tax-friendly environment is needed for businesses to create much-needed jobs here at home instead of shipping those jobs overseas.
In addition to GE, Wells Fargo and Verizon, other well-known corporate names making the list of those who paid no taxes include Boeing, Mattell, Honeywell International, Tenet Healthcare, Corning and Duke Energy. The complete list and study can be found here.
Christopher Seward