Corporations paying taxes

Study says most corporations pay no U.S. income taxes

irs-220.jpgWASHINGTON (Reuters) – Most U.S. and foreign corporations doing business in the United States avoid paying any federal income taxes, despite trillions of dollars worth of sales, a government study released on Tuesday said.

The Government Accountability Office said 72 percent of all foreign corporations and about 57 percent of U.S. companies doing business in the United States paid no federal income taxes for at least one year between 1998 and 2005.

Poor reporting and choice of headlines. If you read the article it is obvious your headline is not true, as the article says “paid no federal income taxes for AT LEAST ONE YEAR BETWEEN 1998 and 2005.”

D.D. .

The headline uses present tense, as if right now this is the case. But within just two lines it becomes clear that the actual story is that most corporations have had one or more years from ’99-’05 for which they reported zero or negative income, meaning they paid no U.S. income tax that year. And for about half those companies, this happened two or more years during that period.

Using present tense (“pay” not “paid”) unambiguously implies that it’s currently happening. But the stats show this no-income situation applies to between 25% and 30% of corporations in any given year. That’s a VERY FAR cry from “most corporations”.

Ezekiel

Several readers felt this headline did not fairly represent the results of the study: GBU Editor 

 REUTERS photo by Kevin Lamarque

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5 comments

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The headline about corporations not paying taxes was so misleading as to be irresponsible. Many corporate entities are small businesses where the owners pay personal income taxes on corporate profits. why is the mainstream media so anti-business? Who do you think keeps the economy alive and growing, government folks? the contribute nothing to the economy, and also pay no income tax on profits. The difference is that corporations must satisfy their customers to stay in business, while government forces tribute (taxes) from individuals and corporations, regardless of how effectively tasks are carried out.

Posted by David | Report as abusive

Why don’t we institute a mimimum tax that all corporations must pay, regardless of deductions, because they use our roads and bridges and need our schools and want and need access to our markets, etc.? This should be done immediately, for all corporations that want to function in our markets, whether they’re here or foreign.

Let’s get this done as soon as possible. It just makes sense.

I was interested in this article since I would like to see almost all corporations pay no corporate income taxes no matter how much income they make.

My reasoning is as follows; When a corporation lets say General Mills pays a tax on the profit it aquired it is going to pass this cost on like all other costs to the extent possible. Now since all food companys if they are profitable also must pay the tax it raises the price of food generally. The corporate income tax raises the cost of food, medical care and every other good and service including government. In the end this means the poor are being taxed even though they can ill afford it. This tax is applied to the money they spend indirectly because of the corporate income tax. So the middle class pays twice once on income ( a fair tax) and again on any money spent the unfair indirect result of the corporate income tax.
Peace to all.

Posted by Michael Hertel | Report as abusive

If you can please try to determine how much corporate income taxes increase the cost of a box of corn flakes.

I know this would be difficult since it is so hard to determine where to start. The store pays some, the trucking firm shipping to the store, the company making the flakes, the box maker, the trucking firm that ships the box to the factory, the ink, the glue, the printing, the corporate corn storage facility, the railroad, the grain dryer, the shipping to the dryer, the farmer, the fuel at all steps, the inputs the farmer needs. The list is quite long and difficult to trace completly. While it is true corporations do use our infrastructure it will be much better if we do not try to charge them to do so and instead reap the reward in the end of lower priced goods and services.
Peace to all.

Posted by Michael Hertel | Report as abusive

You don’t think these Large Corporations are going to reduce there prices do you? NO WAY, and give all of us working stiffs a break. Greed is the name of the game. Corporations pay nothing in Taxes. The tax incentives they get to come into states, deductions they get, etc. etc. etc. They pass everything on to the ones who do pay the Taxes. Corporations are run by MEN/Women, they pay Lawyers/Accountants to make sure they pay NO TAXES.
Believe me Corporate CEO’S, etc. need to justify those Multi Million $ PKG’S. Follow the MONEY! If they take their Corporations out of this Country Double TAX them.
It time Large Corporations paid their share of Taxes, they use everything everyone else uses. There are no angels in the Corporate World.

James Madison had it right.
“IF MEN WERE ANGELS, government would not be necessary”.

Posted by S | Report as abusive