Delft, Netherlands - Many of the biggest private sector companies in America effectively pay no tax to the federal government. As a matter of fact, their tax returns are negative – in fact, they get billions back from the tax authorities.
According to a report by the Institute for Policy Studies and the Centre for Effective Government, both respected think tanks in Washington DC, 29 of these companies in addition pay their Chief Executive Officers more than the amount owed to the tax man.
Among these companies are giants like Boeing, Ford, Chevron, Citybank, General Motors, JP Morgan Chase and Verizon.
The report focuses on the above seven companies and show that their profit before tax in 2013 amounted to $74bn. According to the official tax rate, they were – in theory – liable for tax payments to the tune of $25.9bn.
However, intelligently utilising tax havens and numerous tax rebates, they succeeded in converting the tax debt into a repayment of $1.9bn. This means that they effectively got away without paying a cent to the tax man.
For example, Citigroup got $260m back from the US federal authorities. Its CEO, Michael Corbat, was paid $18m. W. James McNerney, Boeing’s CEO, was paid $23m, while this aircraft manufacturer got $82m back.
One company which was – relatively – unlucky, was Abott Laboratories, whose CEO, Miles White, was paid $21m. The company, however, had to cough up $16m in taxes, even after rebates.
In other words, according to the report, the federal authorities missed a total of $27.8bn’s income. The writers of the report state that this amount could have paid the salaries of 337 000 school teachers, or the repair of 35 558 kilometres of highways.
The think tanks has published a similar yearly report since 2011.
American newspapers report that the companies implicated deny the allegations.
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