Northwest Indiana Times: NiSource among companies getting large tax breaks
media mentionBy Bowdeya Tweh [email protected], (219) 933-3316 | Posted: Friday, November 4, 2011 12:00 am
NiSource Inc. was one of 30 companies that benefited from a negative income tax rate in the past three years, according to two national tax policy research groups.
In a report released Thursday, Citizens for Tax Justice and the Institute on Taxation and Economic Policy listed NiSource among 280 companies that received nearly $223 billion in tax subsidies between 2008 and 2010. The report also said corporate taxes paid for more than 25 percent of federal spending in the 1950s, but in the 2010 fiscal year that share shrunk to 6 percent.
Report lead author Robert McIntyre, director at Citizens for Tax Justice, said the subsidies were “wasted money that could have gone to protect Medicare, create jobs and cut the deficit.”
The report named Fortune 500 companies that were profitable in the past three years and provided information in financial reports about their pretax U.S. profits and U.S. federal income taxes. Other companies named in the report as large beneficiaries of tax breaks were Wells Fargo Bank N.A., Exxon Mobil Corp. and The Boeing Co.
Merrillville-based NiSource, which is the corporate parent for NIPSCO, earned $588.7 million in profit between 2008 and 2010, according to the company’s 2010 annual report filed in February. The report said the company had a income tax benefit over the past three years of $223.4 million.
Mike Banas, a NiSource spokesman, said Thursday the report is misleading because it doesn’t adequately acknowledge tax law changes that occurred during the past couple of years. Those rules include short-term tax incentives for companies that make significant investments in creating new jobs, rebuilding infrastructure and spurring economic recovery.
One rule NiSource, among other companies, benefited from was a bonus depreciation rule that lowered the federal tax expense.
“This law, enacted by Congress, encouraged companies like NiSource to accelerate capital investments to spur economic recovery by permitting portions of these investments to be deducted at an accelerated rate,” Banas said Thursday in an emailed statement.
“It is important to note that only the timing of the deductions was changed, and not the amount that could be deducted. This means our income tax expense will likely be higher in the future.”
Banas also said in the past three years, NiSource has spent more than $3 billion in capital expenditures to support energy infrastructure projects to aid local spending and job creation.