Matthew Gardner

Matt Gardner is a senior fellow at ITEP where he has worked since 1998. He previously served as ITEP’s executive director from 2006 to 2016. Matt’s work focuses on federal, state and local tax systems, with a particular emphasis on the impact of tax policies on low- and moderate-income taxpayers. He uses ITEP’s microsimulation model to produce economic projections and analyses on the effects of current and proposed federal and state tax and budget policies.

• blog   July 18, 2017

  FedEx Pays Just 7.5% of Its Profits in Taxes While Pushing for a Lower Corporate Tax Rate

  The latest annual financial report released by shipping giant FedEx is yet another reminder that where you stand often depends on where you sit.

  The report shows that last year FedEx paid a 7.5 percent federal income tax rate on nearly $3.6 billion of U.S. pretax income and this low rate is due in part to accelerated depreciation, a provision in the tax code that allows the company to write off capital investments faster than they wear out. It’s not surprising, then, that FedEx’s leadership is currently promoting a tax plan that would drop the company’s statutory tax rate even more, and allow it to write off capital investments even faster.

• media mention   May 17, 2017

  International Business Times: How Much Do Companies Really Pay When Settling With The Government? Warren Pushes Bill That Makes It Public

  While is doesn’t strive for a reform in the tax system that allows those firms to write off huge chunks of their fines, the senators’ measure, which applies to settlement…
• blog   May 4, 2017

  Apple: A Case Study in Why a Tax Holiday for Offshore Cash is Indefensible

  The Apple corporation made waves earlier this week with its disclosure that its worldwide cash now exceeds $250 billion.  Less noticed was a separate disclosure on Wednesday that the company’s…
• media mention   May 3, 2017

  Between the Lines: Trump Tax Plan Revives Economic Voodoo

  On April 26, just a few days short of President Trump’s 100th day in office, a so-called “tax reform” plan was released by the White House that consisted of bullet…
• media mention   April 29, 2017

  PBS News Hour: Corporations Go Overseas to Avoid U.S. Taxes

  PATRICIA SABGA: From the White House to Capitol Hill, Republicans are determined to lower the 35 percent corporate tax rate — the highest of any developed economy. Matt Gardner is…
• media mention   April 28, 2017

  CBS News: Trump’s Tax Cut Promise to Pay for Themselves. So Will They?

  The most durable effect of the 1981 cuts was to lay the groundwork for a tax reform in 1986, which was intended not to raise revenue but to clean up…
• media mention   April 27, 2017

  Fast Company: At Last, Silicon Valley May Have Found a Trump Proposal to Like–Hist Tax Plan

  Apple, for one, would likely be happy about a one-time repatriation of earnings, depending on the details of the plan. In 2016, the European Union, after a lengthy investigation, ruled…
• report   April 27, 2017

  3 Percent and Dropping: State Corporate Tax Avoidance in the Fortune 500, 2008 to 2015

  The trend is clear: states are experiencing a rapid decline in state corporate income tax revenue. Despite rebounding and even booming bottom lines for many corporations, this downward trend has become increasingly apparent in recent years. Since our last analysis of these data, in 2014, the state effective corporate tax rate paid by profitable Fortune 500 corporations has declined, dropping from 3.1 percent to 2.9 percent of their U.S. profits. A number of factors are driving this decline, including: a race to the bottom by states providing significant “incentives” for specific companies to relocate or stay put; blatant manipulation of loopholes in state tax systems by corporate accountants; significant cuts in state corporate tax rates; and the erosion of state corporate tax bases, largely due to ill-advised state-level linkages to the federal system.

• blog   April 27, 2017

  President Trump’s Corporate Tax Outline: At Least He Didn’t Use a Napkin

  The most complimentary thing that can be said about the corporate tax changes outlined by President Trump earlier this week is that they weren’t scribbled on a napkin. Unlike supply-side…
• blog   April 25, 2017

  Does a 15 Percent Corporate Tax Rate Sound Low? For Dozens of Major Corporations, Maybe Not

  President Donald Trump has promised to release new details Wednesday on what he says could be “the biggest tax cut we’ve ever had.” While much is unclear about the shape…
• report   April 13, 2017

  Who Pays Taxes in America in 2017?

  All Americans pay taxes. Most of us pay federal and state income taxes. Everyone who works pays federal payroll taxes. Everyone who buys gasoline pays federal and state gas taxes. Everyone who owns or rents a home directly or indirectly pays property taxes. Anyone who shops pays sales taxes in most states.

• report   April 13, 2017

  Fifteen (of Many) Reasons We Need Corporate Tax Reform

  Profitable Fortune 500 companies in a range of economic sectors have been remarkably successful in manipulating the tax system to avoid paying even a dime in tax on billions of dollars in U.S. profits. This ITEP report examines a select, diverse group of 15 corporations’ tax situations to shed light on the widespread nature of corporate tax avoidance. As a group, these companies paid no federal income tax on $21 billion in profits in 2016, and they paid almost no federal income tax on $111 billion in profits over the past five years. All but one received federal tax rebates in 2016, and almost all paid exceedingly low rates over five years.

• report   April 4, 2017

  Testimony before the Alaska House Labor & Commerce Committee On House Bill 36

  Thank you for the opportunity to testify on the changes House Bill 36 would make to Alaska’s tax treatment of pass-through income. The taxation of pass-through business entities has been a focal point of state and federal tax reform debates for over a quarter century, with a dual focus on minimizing the role of tax laws in determining the choice of business entity and on ensuring that the income of all business entities is subject to at least a minimal tax. My testimony makes two main points:
  1. Alaska is one of a small number of states that do not currently impose either an entity-level tax or a personal income tax on the income generated by pass-through businesses. 2. But Alaska fully taxes the income of traditional C corporations, creating a clear incentive for businesses to structure as pass-throughs to avoid income tax.
  In the absence of a statewide personal income tax, imposing an entity-level tax on the net income of pass-through businesses, as HB36 would do, is a straightforward approach to leveling the playing field between different types of business entities, while ensuring these businesses help to fund public investments.

• news release   March 31, 2017

  New Analysis Compares Tax Rates Paid by Companies Lobbying for/against Border Adjustment Tax

  An Institute on Taxation and Economic Policy analysis finds that, on average, companies that are opposed to the Border Adjustment Tax pay higher tax rates than a coalition of companies…
• media mention   March 31, 2017

  The San Diego Union Tribune: Sempra has paid no corporate taxes in recent years … and it’s all legal

  According to figures compiled by the Institute on Taxation and Economic Policy (ITEP), a left-of-center group based in Washington D.C., between 2008 and 2015 Sempra earned $7 billion in profit…
• media mention   March 31, 2017

  The Seattle Times: Boeing Paid Federal Taxes

  Matthew Gardner, a senior fellow at the nonprofit Institute on Taxation and Economic Policy, which lobbies for tax fairness, said Boeing “continues finding new bases for postponing taxes.” “Boeing’s prodigious…
• media mention   March 31, 2017

  International Business Times: Republican Health Care Plan: Trumpcare Gives Wealthiest 1% A $31B Taxcut

  The wealthiest Americans will see the biggest benefit from the Republican plan to repeal the tax on investments and additional Medicare tax in the Republican American Health Care Act, a…
• report   March 28, 2017

  Fortune 500 Companies Hold a Record $2.6 Trillion Offshore

  All told, Fortune 500 corporations are avoiding up to $767 billion in U.S. federal income taxes by holding more than $2.6 trillion of “permanently reinvested” profits offshore. In their latest annual financial reports, 29 of these corporations reveal that they have paid an income tax rate of 10 percent or less in countries where these profits are officially held, indicating that most of these profits are likely in offshore tax havens.

• media mention   March 22, 2017

  Washington Post: How a GOP tax plan would help Caterpillar after a raid by federal agents

  “Caterpillar appears to have elevated international tax avoidance to an art form,” said Matt Gardner, the former director of the left-leaning Institute on Taxation and Economic Policy. “From that perspective,…
• media mention   March 22, 2017

  Kansas City Star: Who would argue taxes with H&R Block? This guy, but only a little

  Who would argue taxes with H&R Block? Matt Gardner would, but only a little. Gardner was the lead author of a recent study by the Institute on Taxation and Economic…
• media mention   March 22, 2017

  Palm Beach Post: NextEra Energy disputes report saying it paid no income taxes

  The study, The 35 Percent Corporate Tax Myth conducted by the left-leaning Institute on Taxation and Economic Policy in Washington, D.C., examined eight years of data on federal income taxes…
• report   March 17, 2017

  Affordable Care Act Repeal Includes a $31 Billion Tax Cut for a Handful of the Wealthiest Taxpayers: 50-State Breakdown

  Congressional Republicans have proposed legislation that would repeal the Affordable Care Act (ACA), including rolling back a number of tax changes that were enacted to pay for the ACA’s health care expansions. Among these tax changes are two targeted income tax increases that took effect in 2013, each of which apply only to a small number of the wealthiest Americans: the net investment tax and additional Medicare tax. Repealing these two taxes would cost over $31 billion a year if implemented in tax year 2016, and 85 percent of the benefit from repealing these taxes would go to the best off 1 percent of Americans nationwide.

  This analysis includes a 50-state breakdown of these impacts.

• media mention   March 13, 2017

  CNBC: Tax policy expert: The 35% corporate rate is a myth, so cutting it won’t bring overseas money back

  Don’t expect big companies to bring profits back from overseas in response to a U.S. corporate tax cut, said Matthew Gardner of the Institute on Taxation and Economic Policy. The…
• media mention   March 9, 2017

  New York Times: U.S. Corporate Taxes Explained

  This New York Times Facebook video features ITEP Senior Fellow Matthew Gardner explaining how profitable Fortune 500 companies exploit loopholes in the tax system to avoid paying the statutory corporate…
• media mention   March 9, 2017

  The Street: Corporate Tax Cuts Could Add 15% to S&P 500

  A new study from the Institute on Taxation and Economic Policy (ITEP) found that 258 consistently-profitable Fortune 500 companies paid an effective federal income tax rate of 21.2% over an…