(Original Post)
By Matthew Miller | November 15, 2011, 9:41am PST
Summary: At a time when the job market is tough and the US economy is struggling, news of Verizon gaming the system and seeking to maximize profits at the expense of contributing to society is unfortunate.
I received multiple emails this morning linking to a new report (PDF link) from the Citizens for Tax Justice and Good Jobs First organizations that shows Verizon paid an effective tax rate of -2.9 percent between 2008 and 2010. Our tax system needs a major overhaul when corporations can play the loophole and subsidy game to avoid helping contribute to our society. Verizon is the most expensive wireless carrier in the U.S. and with Occupy Wall Street (and other areas) protesters and events going on this is not good news for Verizon.
We haven’t yet seen an official response to this report from Verizon, but the report is quite detailed and used publicly available financial data to report its findings.
Verizon doesn’t use its tax avoidance gains to keep up its copper network or extend its fiber optic technology to cities like Boston, Baltimore, Buffalo or other communities or create quality jobs. It isn’t negotiating a fair contract with the workers who have made this company so successful but instead is demanding nearly $1 billion in givebacks and making sure that its top executives stay in the top 1 percent of Americans. That’s why we say ‘the 99 percent’ are picking up Verizon’s tax tab,” Collins said.
It appears that the real problem for Verizon is that they are not necessarily using these tax savings to help customers afford service or provide additional benefits for employees. While the report is pretty clear Verizon is playing the tax game to the best of its abilities, the US government needs to change the system too so that these types of games cannot take place.
I worked hard growing up with a single mom and currently work two jobs to support my family and succeed so I don’t appreciate when games like this are played at my expense. I pay a fair share of taxes and expect all in the U.S. to do so as well. I am quite pleased with my new iPhone 4S on Verizon and am not going to drop their service due to this report, but it does cross my mind that this is a strategy I may follow through with in the future.