Many US profitable companies have never had corporate tax costs since Trump’s demise
Indeed, they have not spent a single dollar on the current corporate tax since Donald Trump went on to cut corporate corporate taxes in the first year of his presidency, according to a new study.
Many of those same companies had already paid billions of dollars in annual taxes before becoming president of Trump.
For example, Salesforce.com made $ 4.2 billion three years before tax. But since 2018, the software company has not set aside money to pay state taxes, according to its submission by security directors. In fact, Saleforce has booked $ 4 million in tax credit since 2018. Three years before Trump’s tax cuts, Saleforce received very little in return but charged more tax revenue – $ 35 million to $ 500 million in profits.
A Salesforce spokesman did not respond to a CBS MoneyWatch question on how much the company had paid in taxes.
Biden backs down criticism of company corporate tax increases
The study comes from the Institute for Taxation and Economic Policy’s free agency, as national debate intensifies whether companies pay their taxes. This week, President Joe Biden said he hoped to significantly raise taxes on companies that would help fund the $ 2 trillion national infrastructure development program, which could cost the state government billions of dollars.
On Friday, Mr Biden said his infrastructure application was “a single investment in the future, paid for by asking large companies, many of which are tax-free, to pay their fair share.”
Earlier this week, Mr Biden unveiled a plan to increase US $ 2 trillion in US tax-paid companies over the next decade. It involves the introduction of a 15% corporate tax rate depending on the income of companies reporting to investors.
“There are allegations that large companies are not paying their fair share,” said Matthew Gardner, an ITEP executive and co-author of the study. “Finding something like this will support that view.”
While it is clear that companies pay less than they did before Trump’s tax cuts, how much money a given business puts in taxes is uncertain. Reason: Companies, as individuals, are permitted to keep taxes and payments confidential.
However, public companies that report their profits to investors should also provide in their financial statements a limited amount of taxable income over the next 12 months and any tax costs they may incur in the future. Details are also needed for whom such taxes can be paid, such as the provincial government, the state, or foreign governments.
The ITEP study did not find the current value of corporate income tax companies listed on the S&P 500 stock index levied three years ago. Accounting experts traditionally say that the figure provides a fair measure of what is expected of companies to pay corporate taxes. With a little help, the provisions of the tax law have made that figure less credible.
For example, ITEP identified FedEx as one of the company’s largest taxpayers in the last three years. The delivery giant disputed the claim earlier, claiming it was paying the organization’s annual tax when it refused to disclose the amount. FedEx’s financial statements show that its financial accounts – another form of corporate income – have fallen by $ 400 million over tax payments over the past three years.
Tax prices are obviously low
However, what many US tax-paying companies may be jealous of individual taxpayers. Recent financial submissions have shown that Zoom, its revenue and profits that have increased during the coronavirus epidemic, have not taxed the 2020 tax despite the company’s record acquisition by videoconferencing.
According to CBS MoneyWatch’s data analysis from FactSet, the average corporate tax rate for S&P 500 companies last year was only 18% – down from 23% in 2017. Look at the corporate tax code and the effective prices of these companies are likely to be very low.
Duke Energy, for example, had a US pretax profit of nearly $ 8 billion over the past three years. Duke not only paid corporate taxes during this period, and also imposed a state tax debt of just over $ 1.2 billion, according to ITEP.
Responding to the study, Duke Energy told The New York Times that investing in renewable energy has allowed it to delay, but not eliminate, corporate tax obligations. The company’s most recent investment has recorded a $ 9 billion debt to pay the organization’s future tax.
Other large companies ITEP researchers say have not paid corporate taxes in recent years despite booking huge profits include TV and Internet provider Dish Network and sports gear company Nike.
On Friday, in response to the survey, Vermont Senator Bernie Sanders tweeted that Nike Air Force 1 shoes would cost more than tax money over the past three years. A Nike spokesman did not respond to a request for comment.
ITEP has also identified 55 companies that make money in the past, but that does not appear to have paid off in the organization’s policies on that profit. For example, research shows that cable company Charter Communications made $ 3.6 billion during the epidemic, but booked a $ 7 million tax bill last year.
Charter Communications did not respond to a request for comment.