By Eoin Higgins/Common Dreams
A new analysis out Thursday shows that tax policy under the Trump administration is benefitting large corporations to such a degree that twice as many large companies will pay nothing in federal taxes for 2018 compared to previous years.
The report, by the Institute on Taxation and Economic Policy, found that 60 companies – including Amazon, Netflix, Activision Blizzard, General Motors, and IBM – used “a diverse array of legal tax breaks” to bring their federal tax liability to zero.
“For years, corporations have manipulated the system to avoid paying taxes, and it’s clear that the 2017 [Trump tax cut] did nothing to change this,” said Matthew Gardner, a senior fellow at ITEP and lead author of the report.
See the complete list of U.S. companies which paid “not a dime” in federal taxes last year here.
Hey look, Paul Ryan completing his life’s work/J. Scott Applewhite, AP
As IETP said in a statement announcing the study’s results:
The tax-avoiding corporations are some of the most profitable, recognizable companies in the world, and they represent a variety of industries, including technology, energy and gas, financial services, aviation, pharmaceutical and manufacturing. Earlier this year, ITEP reported Netflix and Amazon paid no federal taxes. Other companies on this list include Chevron, Delta Airlines, Eli Lilly, General Motors, Gannett, Goodyear Tire and Rubber, Halliburton, IBM, Jetblue Airways, Principal Financial, Salesforce.com, US Steel, and Whirlpool.
These companies avoided taxes by employing a variety of legal tax breaks. Accelerated depreciation allows companies to write off the cost of their investments much faster than these investments wear out. This break accounted for hundreds of millions in tax write-offs. Chevron alone, for example, reported $290 million in accelerated depreciation, and Halliburton reported $320 million.
According to the institute, U.S. lawmakers “interested in enacting true tax reform should critically assess the costs of each of existing tax break – including those discussed in this report – and take steps to ensure that profitable corporations pay their fair share of U.S. taxes.”
One of those lawmakers is Sen. Elizabeth Warren (D-Mass.) – a Democratic presidential candidate for the 2020 election – who on Thursday released her Real Corporate Profits Tax bill. The proposed legislation would impose a flat 7 percent tax on American corporations with profits over $100 million, as Common Dreams reported.
“Some of the biggest corporations in the country make huge profits but pay zero federal corporate income taxes on those profits,” Warren said in a Medium post explaining the bill.
Gardner explained to the Center for Public Integrity and NBC News that the Trump tax cuts in 2017 – which dropped the corporate tax rate from 35% to 21% – are the main driver behind both the reduction in corporate taxes for 2018 and the increase in companies paying nothing.
“The specter of big corporations avoiding all income taxes on billions in profits sends a strong and corrosive signal to Americans that the tax system is stacked against them, in favor of corporations and the wealthiest Americans,” said Gardner.
The loss of federal revenue is not without far-reaching repercussions.
“We cannot pretend that corporate tax avoidance has no cost,” said Gardner. “Corporations zeroing out their tax bills or paying single-digit federal tax rates mean a substantial loss in federal revenue. Calls to cut critical programs and services in the wake of these corporate tax cuts are absolutely connected.”
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Previously in tax scammage:
* McDonald’s Breaks Promise To Raise Wages.
* Last Year, Amazon Paid No Federal Income Taxes. Now, It’s Trying To Kill A Local Tax That Aims To Help the Homeless.
* Trump Vowed To Punish Companies That Moved Jobs Overseas. Is Congress Rewarding Them?
* After Long Career Bailing Out Big Banks, Obama Treasury Secretary Tim Geithner Now Runs Predatory Firm That Exploits The Poor For Profit.
* Jeff Bezos Just Became The Richest Person Ever. Amazon Workers Just Marked #PrimeDay With Strikes Against Low Pay And Brutal Conditions.
* A Sweet New Century For America’s Most Privileged.
* With Nation Transfixed By Kavanaugh Monstrosity, House GOP Votes To Give Rich Another $3 Trillion In Tax Cuts.
* Deepwater Horizon Settlement Comes With $5.35 Billion Tax Windfall.
* Offshoring By 29 Companies Costs Illinois $1.2 Billion Annually.
* Government Agencies Allow Corporations To Write Off Billions In Federal Settlements.
* The Gang Of 62 Vs. The World.
* How The Maker Of TurboTax Fought Free, Simple Tax Filing.
* $1.4 Trillion: Oxfam Exposes The Great Offshore Tax Scam Of U.S. Companies.
* How Barclay’s Turned A $10 Billion Profit Into A Tax Loss.
* Wall Street Stock Loans Drain $1 Billion A Year From German Taxpayers.
* German Finance Minister Cries Foul Over Tax Avoidance Deals.
* Prosecutor Targets Commerzbank For Deals That Dodge German Taxes.
* A Schlupfloch Here, A Schlupfloch There. Now It’s Real Money.
* How Milwaukee Landlords Avoid Taxes.
* Study: 32 Illinois Fortune 500 Companies Holding At Least $147 Billion Offshore.
* Watch Out For The Coming Tax Break Trickery.
* When A ‘Tax Bonanza’ Is Actually A Huge Corporate Tax Break.
* The Hypocrisy Of Corporate Welfare: It’s Bigger Than Trump.
* Oxfam Names World’s Worst Tax Havens Fueling ‘Global Race To Bottom.’
* Offshore Tax Havens Cost Average Illinois Small Business $5,789 A Year.
* State Tax Incentives To Corporations Don’t Work.
* GOP Tax Plan Would Give 15 Of America’s Largest Corporations A $236 Billion Tax Cut.
* Triumph Of The Oligarchs.
* Amazon Short-List Proves Something “Deeply Wrong” With America’s Race-To-The-Bottom Economy.
* Apple’s $38 Billion Tax Payment Less Than Half Of $79 Billion They Owe.
* U.S. Surpasses Cayman Islands To Become Second-Largest Tax Haven On Earth.
* Less Than Year After GOP Tax Scam, Six Biggest Banks Already Raked In $9 Billion In Extra Profits.
* After Budget Cuts, The IRS’s Work Against Tax Cheats Is Facing “Collapse.”
* $6.5 Billion: A Low-Ball Estimate Of The Walton Family’s Haul After 16 Years Of Bush, Obama And Trump Tax Giveaways.
* Illinois Could Recover $1.3 Billion Lost To Corporate Tax Loopholes.
* Whatever You Paid To Watch Netflix Last Month Was More Than It Paid In Income Taxes All Last Year: $0.
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Previously in The Paradise Papers:
* ‘Paradise Papers’ Reveal Tax Avoidance, Shady Dealings Of World’s Rich And Powerful.
* Just How Much Money Is Held Offshore? Hint: A SHIT-TON.
* Development Dreams Lost In The Offshore World.
* Keeping Offshore ‘Hush Hush,’ But Why?
* Tax Havens Are Alive With The Sound Of Music.
* Today In Tax Avoidance Of The Ultra-Wealthy.
* Go To Town With This Offshore Leaks Database.
* The Paradise Papers: The View From Africa And Asia.
* The Paradise Papers: The End Of Elusion For PokerStars.
* The Paradise Papers: An Odd Call From The Bermuda Government.
* The Paradise Papers: Nevis Is An Offshore Haven Of Opportunity
* The Paradise Papers: The Long Twilight Struggle Against Offshore Secrecy.
* The Paradise Papers: A Fair Tax System Will Be Lost Without Public Pressure.
* Item: Today In The Paradise Papers: Through Death Threats And Scare Tactics, Honduran Reporter ‘Perseveres.’
* The Paradise Papers: Journalists Flee Venezuela To Publish Investigation.
* Last Stop: Chicago.
* The Paradise Papers: ‘Africa’s Satellite’ Avoided Millions Using A Very African Tax Scheme.
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Previously in The Panama Papers:
* The Panama Papers: Remarkable Global Media Collaboration Cracks Walls Of Offshore Tax Haven Secrecy.
* The Panama Papers: Prosecutors Open Probes.
* The [Monday] Papers.
* Adventures In Tax Avoidance.
* Mossack Fonseca’s Oligarchs, Dictators And Corrupt White-Collar Businessmen.
* Jonathan Pie, TV Reporter! They’re All In It Together.
* Meet The Panama Papers Editor Who Handled 376 Reporters In 80 Countries.
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Previously in carried interest, aka The Billionaire’s Loophole:
* Patriotic Millionaires Vs. Carried Interest.
* The Somewhat Surreal Politics Of A Private Equity Tax Loophole Costing Us Billions (That Obama Refused To Close Despite Pledging To Do So).
* Fact-Checking Trump & Clinton On The Billionaire’s Tax Break.
* Despite Trump Campaign Promise, Billionaires’ Tax Loophole Survives Again.
* Carried Interest Reform Is a Sham.
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Comments welcome.
Posted on April 13, 2019