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The Paradox of Corporate Taxes
Key Excerpts from Article on Website of New York Times
Posted: May 10th, 2011
http://www.nytimes.com/2011/02/02/business/economy/02leonhar...
Of the 500 big companies in the well-known Standard & Poors stock index, 115 paid a total corporate tax rate both federal and otherwise of less than 20 percent over the last five years, according to an analysis of company reports done for The New York Times by Capital IQ, a research firm. Thirty-nine of those companies paid a rate less than 10 percent. Arguably, the United States now has a corporate tax code thats the worst of all worlds. The official rate is higher than in almost any other country, which forces companies to devote enormous time and effort to finding loopholes. Yet the government raises less money in corporate taxes than it once did, because of all the loopholes that have been added in recent decades. Over the last five years ... Boeing paid a total tax rate of just 4.5 percent. Southwest Airlines paid 6.3 percent. And the list goes on: Yahoo paid 7 percent; Prudential Financial, 7.6 percent; General Electric, 14.3 percent. Economists have long pleaded for an overhaul of the corporate tax code. But it wont be easy. Companies that use loopholes to avoid taxes dont mind the current system, of course, and they have more than a few lobbyists at their disposal.
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