The number of U.S. companies paying zero federal taxes DOUBLED when Trump's tax plan took effect in 2018
· 60 large companies managed to escape 2018 taxes under Trump's new plan
Apple CEO Tim Cook: Global Tax System Needs to Be Overhauled
2:41
Tim Cook, the CEO of tech giant Apple, has stated that a global overhaul of tax regulations is needed. Cook supports a current initiative by the Organisation for Economic Cooperation and Development to pursue global reforms on where multinational firms should be taxed.
Reuters reports that Apple CEO Tim Cook has expressed his support of and initiative by the Organisation for Economic Cooperation and Development (OECD) to pursue global reforms over where multinational firms should be taxed. The reforms center around booking the profits of multinational firms such as countries in low-tax countries such as Ireland where Apple’s business outside the U.S. is based, rather than where most of their customers are.
Speaking in Ireland at an event where Cook received an award from the Irish state agency responsible for attracting foreign companies recognizing the contribution of multinationals in the country, Cook stated: “I think logically everybody knows it needs to be rehauled, I would certainly be the last person to say that the current system or the past system was the perfect system. I’m hopeful and optimistic that they (the OECD) will find something.”
Cook added: “It’s very complex to know how to tax a multinational… We desperately want it to be fair.” Apple is one of the largest multinational employers in Ireland where it employs 6,000 people, both Apple and the Irish government have gone to court to fight a European Union order forcing Apple to pay 13 billion euros ($14.41 billion) in back taxes to the country.
The appeal of the order went to Europe’s second-highest court in September and could continue for years. Cook has argued that the EU “law should not be retrofitted” to Apple’s situation in Ireland. Cook also called for further privacy regulation in the EU and the expanse of the 2018 European General Data Protection Regulation (GDPR).
“I think more regulation is needed in this area, it is probably strange for a business person to be talking about regulation but it has become apparent that companies will not self-police in this area,” he said.
“We were one of the first to endorse GDPR, we think it is overall extremely good, not only for Europe. We think it’s necessary but not sufficient. You have to go further and that further is required to get privacy back to where it should be.”
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or email him at lnolan@breitbart.com
Watchdog
Accuses Silicon Valley Giants of Dodging $100 Billion in Taxes
Six of the Silicon Valley
Masters of the Universe have been accused of dodging $100 billion in taxes by a
British tax watchdog.
CNBC reports that six
major Silicon Valley tech firms have been accused of having a combined “tax
gap” of $100 billion over the past ten years according to an analysis by a
British tax organization. Fair Tax Mark, a British organization that certifies
businesses for proper tax conduct, examined the global tax payments of
Facebook, Apple, Amazon, Netflix, Google, and Microsoft from 2010 to 2019.
The research analyzed the company’s
10-K filings submitted to the U.S. government by the tech giants. Fair Tax Mark
looked at tax provisions, which is the amount that companies set aside in their
financial reports to pay taxes, and compared these with the amount of money
that the companies actually paid to the government, called cash taxes.
Researchers found that over the past ten years, the gap between the tax
provision set out by the tech firms and the taxes they actually paid was
approximately $100.2 billion.
The report also claimed that the
profits were “shifted to tax havens, especially Bermuda, Ireland,
Luxembourg and the Netherlands.” The researchers noted that most of the tax
shortfall “almost certainly arose outside the United States,” with tax charges
from countries outside the United States coming to 8.4 percent of the
companies’ profits overseas.
Paul Monaghan, CEO of Fair Tax Mark,
discussed the report with CNBC stating: “The amount of tax being paid by
these businesses is $100 billion less than reported in their accounts.” The
report noted that Amazon was the worst offender of the six tech firms. The report
alleged that Amazon paid $3.4 billion in income taxes since 2010, noting that
the cash tax paid by Amazon amounted to 12.7 percent of its profit for the
decade despite the corporate tax rate being set at 35 percent for seven of the
past ten years. President Donald Trump cut the corporate tax rate to 21 percent
in 2017.
The report stated: “The company
is growing its market domination across the globe on the back of revenues that
are largely untaxed and can unfairly undercut local businesses that take a more
responsible approach.” A spokesperson for Amazon told CNBC in a statement:
Amazon represents about 1% of global
retail, with larger competitors everywhere we operate, and had a 24% effective
tax rate on profits from 2010-2018. Amazon is primarily a retailer where profit
margins are low, so comparisons to technology companies with operating profit
margins of closer to 50% is not rational. Governments write the tax laws and
Amazon is doing the very thing they encourage companies to do — paying all taxes
due while also investing many billions in creating jobs and infrastructure.
Coupled with low margins, this investment will naturally result in a lower cash
tax rate.
Facebook had the second-biggest tax
gap with the cash tax it paid representing 10.2 percent of the profit it made
over the decade. A spokesperson for Facebook told CNBC:
In 2018 we paid $3.8 billion in
corporation tax globally and our effective tax rate over the last five years is
more than 20%. Under current rules we pay the vast majority of the tax we owe
in the U.S. as that is where the bulk of our functions, assets and risks are
located. Ultimately these are decisions for governments and we support the OECD
process which is looking at new international tax rules for the digital
economy.
Google ranked third with its taxes
amounting to 15.8 percent of its profits with its foreign tax charge amounting
to 7.1 percent. A Google spokesperson told CNBC that the report form Fair Tax
Mark “ignores the reality of today’s complicated international tax system
and distorts the facts documented in our regulatory filings.”
The company added: “Like other
multinational companies, we pay the vast majority — more than 80% — of our
corporate income tax in our home country. As we have said before, we strongly
support the OECD’s work to end the current uncertainty and develop new tax
principles.”
Netflix ranked fourth in the list
handing over 15.8 percent of its profit while Apple ranked fifth with a tax
rate of 17.1 percent. Apple told CNBC in a statement:
As the largest taxpayer in the
world, we know the important role tax payments play in society. We pay all that
we owe according to tax laws and local customs wherever we operate, and since
2008 Apple’s corporate taxes alone have totaled over $100 billion.
Microsoft paid the highest tax rate
of 16.8 percent with a spokesperson telling CNBC: “Microsoft is fully compliant
with all local laws and regulations in every country in which we operate. We
serve customers in countries all over the world and our tax structure reflects
that global footprint.”
Lucas Nolan is a reporter for
Breitbart News covering issues of free speech and online censorship. Follow him
on Twitter @LucasNolan or email him at lnolan@breitbart.com
"At the same
time, the tax cuts for big business are fueling the federal deficit, which will
be used by both Democratic and Republican politicians to call for further cuts
in social spending. The February monthly federal deficit hit an all-time high
of $234 billion this year, as a result of a 20 percent drop in corporate tax
revenue. The deficit for the first half of 2019 is projected at $961 billion,
and the deficit for the fiscal year ending September 30 is expected to reach
$1.1 trillion, as bad as the deficits posted in the immediate aftermath of the
2008 financial crash."
US Tax Day 2019: Sixty giant corporations pay
zero income tax
Dozens of giant US
corporations, including 60 of the Fortune 500, used deductions, credits and
other tax loopholes to avoid paying any federal income tax for 2018, according
to an analysis issued by the Institute on Taxation and Economic Policy (ITEP).
The report was published April 11, just in time for the April 15 deadline for
most American working people to file their tax returns.
The 60 companies in the
Fortune 500 who paid no federal income tax had net incomes just from US
operations of nearly $80 billion ($79,025,000,000, to be exact). They include
such household names as Amazon, Chevron, Deere, Delta Air Lines, General
Motors, Goodyear, Halliburton, Honeywell, IBM, Eli Lilly, Netflix, Occidental
Petroleum, Prudential Financial and US Steel.
Meanwhile, millions of
moderate-income families are finding that their income taxes have either
increased or their expected tax refunds have evaporated because of restrictions
on the itemization of tax deductions, the imposition of a $10,000 cap on state
and local tax deductions and a cut in the mortgage interest deduction.
Nearly all of the 60
companies that paid no taxes qualified to receive a refund from the US
Treasury, although most will not collect a check, instead using the credit to
offset future taxes. But whatever the bookkeeping process, American taxpayers
are effectively paying money to them, despite their vast profits.
The biggest refunds include those going to Prudential, $346 million (added to
its $1.44 billion in profits); Duke Energy, a whopping $647 million (added to
$3.02 billion in profits); and Deere, $268 million (added to $2.15 billion in
profits).
Among the report’s most
outrageous findings:
Amazon more than
zeroed-out its tax bill on $10.8 billion in profits, making use of accelerated
depreciation deductions on equipment as well as favorable tax treatment of
stock-based compensation for executives like CEO Jeff Bezos, the wealthiest man
in the world. The stock compensation deduction alone was worth $1 billion.
Amazon will actually show a credit of $129 million from the US Treasury, not
paying one cent in federal income taxes.
IBM is another corporate
giant that has gamed the tax system by shifting earnings to its foreign
operations to escape US taxation. The company reported worldwide profits of
$8.7 billion, but only $500 million in the United States. It will reap a $342
million credit from the Treasury.
Delta Airlines accumulated $17.1
billion in federal pre-tax net losses as of 2010, partly as a consequence of a
protracted crisis of the airline industry, partly as a result of the 2008 Wall
Street crash. It has used these losses as well as the accelerated depreciation
credit for purchase of new planes to “dramatically reduce their tax rates,”
according to the ITEP report, receiving a credit of $187 million in 2018
despite net profits of more than $5 billion. According to Delta’s chief
financial officer, the actual tax rate the company expects to pay going forward
is between 10 and 13 percent, far below what a typical Delta worker pays on his
or her income.
EOG Resources, a renamed remnant of
Enron, perpetrator of the biggest corporate fraud in American history, can
collect $304 million from US taxpayers on top of $4.07 billion in profits.
For one company, the
federal tax refund would actually exceed net profits. Gannett made
a $7 million profit, while showing an additional $11 million credit from the
Treasury, giving the newspaper publishing giant an effective tax rate of
negative 164 percent.
IBM’s tax rate was a
negative 68 percent, while software maker Activision Blizzard and construction
company AECOM Technology both posted effective tax rates of negative 51
percent.
Sixteen of the 60
companies made more than a billion dollars in net income on their US
operations, to say nothing of foreign subsidiaries. Oil and gas producers and
utilities comprised more than one-third of the total, led by Chevron and
Occidental among the oil companies, and DTE Energy, American Electric Power,
Duke Energy and Dominion Resources among the utilities.
The 60 companies
profited enormously because the Trump tax cut bill cut the basic rate for
corporations from 35 percent to 21 percent, while not eliminating the loopholes
they had previously used to keep their taxes low. They had the best of both
worlds, paying lower rates while still enjoying loopholes.
Overall, according to
the Joint Committee on Taxation, an arm of Congress, the cut in the corporate
tax rate alone will pump $1.35 trillion into the pockets of the corporations
over the next 10 years. For this year alone, corporate taxes have been cut by
31 percent.
For the 60 companies in
the ITEP report, “Instead of paying $16.4 billion in taxes, as the new 21
percent corporate tax rate requires, these companies enjoyed a net corporate
tax rebate of $4.3 billion, blowing a $20.7 billion hole in the federal budget
last year.”
This figure by itself
is an irrefutable answer to all the bogus claims—made to workers in every part
of the United States—that there is “no money” to pay for needed social
programs, for wage and benefit increases, or to hire additional workers to
reduce overwork and understaffing. The $20.7 billion would pay for a $7,000
bonus to every public school teacher in America.
The bonanza that these
60 corporations are enjoying is three times the amount that Trump proposes to
cut from the budget of the Department of Education. It is 10 times the total
amount budgeted for the Bureau of Indian Affairs, which provides services for
more than 2 million Native Americans. It is nearly 20 times the budget of the
Occupational Safety and Health Administration, which conducts workplace safety
inspections.
The ITEP report, issued
by a group with close ties to the Center on Budget and Policy Priorities, a
liberal Washington think tank, warns of the explosive political consequences of
the corporate plundering of the Treasury. “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,” the report says.
At the same time, the
tax cuts for big business are fueling the federal deficit, which will be used
by both Democratic and Republican politicians to call for further cuts in
social spending. The February monthly federal deficit hit an all-time high of
$234 billion this year, as a result of a 20 percent drop in corporate tax
revenue. The deficit for the first half of 2019 is projected at $961 billion,
and the deficit for the fiscal year ending September 30 is expected to reach
$1.1 trillion, as bad as the deficits posted in the immediate aftermath of the
2008 financial crash.
The number of U.S. companies paying zero federal taxes DOUBLED when
Trump's tax plan took effect in 2018
·
60 large companies managed to escape 2018
taxes under Trump's new plan
·
Many of those corporations actually received
tax rebates totaling $4.3 billion
·
The businesses include: Amazon, Netflix,
Chevron, Delta Airlines, JetBlue Airways, IBM, General Motors, Goodyear, Eli
Lilly and United States Steel
·
The result is a $20.7 billion budget hole
that is adding to America's federal debt
President Donald
Trump's tax policy doubled the number of highly
profitable companies that were able to avoid paying any federal taxes in 2018,
according to a new report.
Amazon, Netflix,
Chevron, Delta Airlines, IBM, General Motors and Eli Lilly were among those who
managed to escape taxes for last year, according to the study by the
Institute on Taxation and Economic Policy.
'Instead
of paying $16.4 billion in taxes, as the new 21 percent corporate tax rate
requires, these companies enjoyed a net corporate tax rebate of $4.3 billion,
blowing a $20.7 billion hole in the federal budget last year,' the report
says.
The
Washington, D.C. think tank analyzed America's 560 largest publicly held
companies, finding that 60 of them paid nothing in taxes for last year – double
the average of roughly 30 companies that got away scot-free each year from
2008-2015.
Republicans
in Congress pushed through the tax law signed by Trump in 2017, and its
policies favoring the richest Americans and most valuable U.S. companies took
effect in 2018.
Scroll down for the full list of companies and rebates
·
This graph illustrates the amount of money that 60 of America's largest
companies were billed for taxes last year - along with the actual money they
ended up getting back instead of having to pay. Source: Institute on
Taxation and Economic Policy
The
change cut the tax rate from 35 percent to 21 percent and allowed companies to
take advantage of deductions, tax credits and rebates. That change alone is
projected to save corporations $1.35 trillion over the next decade, according
to the Joint Committee on Taxation.
'We
know that there's this pretty glaring contrast between what the proponents of
this tax law promised back in 2017 and what it's delivering now,' lead
author Matthew Gardner told DailyMail.com.
'The
whole argument was that the reason companies were avoiding taxes is because tax
rates are so high,' he added. 'What we're seeing is that isn't coming to
pass.'
Collectively, the 60 companies that avoided
all taxes last year managed 'to zero out their federal income taxes on $79
billion in U.S. pretax income,' according to the study, which was first
reported on by the Center for Public Integrity and
NBC News.
For
example, the John Deer farm equipment company earned $2.15 billion before
taxes, yet owed no U.S. taxes and used deductions and credits to extract $268
million from the federal government.
Nationally,
corporate tax revenues decreased 31 percent in 2018 to $204 billion.
'This
was a more precipitous decline than in any year of normal economic growth in
U.S. history,' wrote Gardner, a senior fellow for the Institute on Taxation and
Economic Policy, in the report.
We know that there's this pretty
glaring contrast between what the proponents of this tax law promised back in
2017 and what it's delivering now.
-Matthew Gardner, Institute on Taxation and Economic Policy
Trump
had said that the corporate tax cut would pay for itself by sparking a business
boom that would create more jobs, thus generating growing income tax revenues
for the nation.
That
reality hasn't emerged. Instead the nation's budget deficit is higher than it's
ever been in this nation's history.
That's
despite Trump's campaign promise to eliminate the $19.9 trillion national debt
in eight years. So far it has ballooned 41.8 percent in the first four months
of the 2019 fiscal year (which runs October 1 – September 30.
The
Government Accountability Office announced in April that the 'federal
government's current fiscal path … (is) unsustainable.'
Presidential
economic adviser Larry Kudlow has said that 'economic growth' has 'paid for a
good chunk' of the tax cuts, and that the budget's outlook is 'not as bad' as
it's perceived.
+2
·
This table lists the amount of money that 60 of America's largest
companies were billed for taxes last year - along with the actual money they
ended up getting back instead of having to pay. Source: Institute on
Taxation and Economic Policy
No comments:
Post a Comment