September 6, 2017

Politico: Why Corporate Tax Reform Is So Messy

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There is even greater variation among individual companies. Eighteen of the 258 Fortune 500 companies that were consistently profitable between 2008 and 2015 did not pay any federal taxes during those years, according to the Institute on Taxation and Economic Policy, a liberal-leaning group that analyzed their SEC disclosures. Among them: General Electric, and Duke Energy.

Another 30 of the companies had effective rates of less than 10 percent, the group said. Yet it also found that 66 companies — about one-quarter of those analyzed — paid effective rates of more than 30 percent.

“For every company that is essentially crying wolf, saying this tax rate is too high even though they’re not actually paying it, there’s another company that really is paying something close to the statutory tax rate,” said Matt Gardner, a senior fellow with the group.

“A pretty central component to tax reform ought to be trying to find a way to equalize the effective tax rates between different industries, and certainly equalizing the effective tax rates within industries, so that the tax system isn’t benefiting one company over its competitor,” he said.