Some of this country’s most profitable companies pay nothing in federal income tax — at a time when the government is broke. A new report from Citizens for Tax Justice and the Institute on Taxation and Economic Policy explains the painful truth of what is going on.
The nonprofit advocacy group reviewed 280 of America’s largest companies from 2008 through 2010. All were profitable — to the tune of $1.4 trillion combined. Yet 78 of the companies paid zero or less
sacre blueu! Q'est que c'est "less?"in federal income taxes in at least one of the years. In addition, the government gave some of the companies billions of your tax dollars in “tax rebate checks,” according to the report.
This makes a mockery of federal tax law requiring corporations to pay 35 percent of their profits in income taxes. It should offend all Americans who hear political leaders talk about cutting programs because the government does not have enough money to pay for them when some profitable corporations are let off without paying a dime.
Lawmakers on a “super committee” are trying to find ways to reduce the federal deficit by more than $1 trillion. That will mean cuts. On Monday Republican presidential candidate Mitt Romney told Iowans his plan for reducing the deficit. Deciding whether to fund a program would be based on whether it is “worth borrowing money from China to pay for it,” he said.
But the $222.7 billion in tax subsidies that went to 280 corporations is money the government would not have to borrow. Instead of allowing those 280 corporations to avoid paying their share, the government ought to be collecting taxes from them — just like it does from countless others.
Forget about gauging the worth of a government program by whether we should get a loan from China to pay for it. No one should be considering cuts to food stamps, health care, transportation funding or safety net programs when companies like DuPont, General Electric and Duke Energy have paid no income taxes on their profits for three years.
As if all this isn’t astounding enough, some politicians are advocating more of the same kind of tax relief. We need to be “business friendly,” they argue. We don’t disagree, to an extent. But it doesn’t get much friendlier than making it legal to not pay any taxes on your profits. You couldn’t get a better friend than a government that sends you a “rebate” check even though you paid no taxes on your profits.
What lawmakers should be talking about is making corporations pay their fair share to support the basic services in this country — services that benefit these corporations. That’s the same government that built the transportation network and educated the workforce and provided the military that helped the companies become so profitable.
The 67-page report on corporate taxes should be required reading for all members of Congress and all political candidates. It dispels the myth that companies pay more taxes in the United States than other countries. It shows the impact of relentless corporate lobbying in Washington. It underscores the unfairness of some companies paying their share while their competitors don’t.
The report also serves as a reminder to Republicans that their own Ronald Reagan understood the absurdity of such tax dodges. “I just didn’t realize that things had gotten that far out of line,” he told his Treasury secretary. Then he eliminated many corporate tax loopholes when he signed the Tax Reform Act of 1986.
Yet in the years that followed, lawmakers and presidents undid that progress. They continue to do so. Now we face this enormous financial mess.
While taxes paid by corporations funded one-fourth of the federal government’s expenses in the 1950s, they now cover 6 percent. Our leaders talk about doing them more financial favors while slashing programs millions of Americans rely on.
What a country.
I have one HUGE beef with this editorial: NAME THE FRIGGIN SLACKARD COMPANIES - but, to do so, might risk a back lash of pulled advertising!
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