The following information should not be a surprise to anyone: A recent AARP article titled “What an Outrage” tells it like it is. They report that at least 3,700 businesses that received government contracts or grants under the American Recovery and Reinvestment Act of 2009 are delinquent on a whopping $750 million plus in unpaid corporate income taxes, unemployment, payroll and excise taxes according to the Government Accountability Office. And that’s probably a low-ball number as it doesn’t take into account those businesses that did not even submit a tax return.
These same companies/corporations received a whopping $24 billion for a wide variety of projects from construction to security services.
Even more disturbing is this: Federal law does not require corporations or businesses to be current on their taxes to do business with our federal government. How ridiculous is that?
As Sen. Carl Levin, D-Michigan points out, “Tax deadbeats should not be getting taxpayer dollars, and they shouldn’t be allowed to compete against honest businesses that meet their tax obligations!”
In the 1950s, 28 percent of federal revenues came from corporate taxes and it was 21 percent in the 1960s. Today that figure is under 10 percent.
And another shocker, despite the deceptive advertising by conservatives who continually tell us we need to lower taxes for businesses: Corporate income tax revenues are already nearly 25 percent lower in the U.S. than in most European countries!
Anyone else willing to insist the Republicans start telling Americans the truth about how much unnecessary tax breaks and tax credits are adding to our defict?
Ron Livdahl
Mesa
DemocraticDad posted at 10:20 am on Fri, Jul 29, 2011.
Thanks Ron! This is an excellent letter. I fully agree! It IS about time that the, "Republicans start telling Americans the truth about how much unnecessary tax breaks and tax credits are adding to our defict" and stop duping the citizens of this great country.
Accuracy posted at 10:40 am on Fri, Jul 29, 2011.
As Sen. Carl Levin, D-Michigan points out, “Tax deadbeats should not be getting taxpayer dollars, and they shouldn’t be allowed to compete against honest businesses that meet their tax obligations!”
Sure, the same way President Obama said he was bothered by the idea that a U.S. company could pay no taxes. And at the same time, he wouldn't talk about General Electric, that earned $14.2 billion in profits in 2010 and paid nothing in federal taxes last year.
So, “where's the tax truth" about tax deadbeats? Since Obama appointed CEO of GE, Jeffrey Immelt to the council advisory role; to advises the president on job growth, but not to talk about tax policies.
Rich posted at 6:16 pm on Fri, Jul 29, 2011.
No profitable corporation pays taxes, it's either overhead or in cost of sales. Some of them collect it is all. And when they do you pay an extra ten percent or so to cover their overhead to do it. Which is a bad bargain and you're better off to pay it directly. If you'd like part of the $14.2 billion GE earned, go to your broker and buy GE stock. What no one seems to get is that the public owns these corporations, as well as being the government's largest creditor. About all that's really being said here is that the public is as bad at running corporations as they are at running a government.
Arizona Willie posted at 7:28 am on Sat, Jul 30, 2011.
Rich, that's a load of pull puckey. If corporations don't pay taxes, then why do they threaten to move to places that offer them lower taxes?
Businesses move to states with lower tax rates. Businesses move within a state to cities that have lower tax rates.
Cities and states often make deals with large corporations where they get a tax abeyance for a number of years if they move to their state / city.
If businesses just passed the taxes along in the cost of their product / service they wouldn't care how much the tax was because they weren't paying it.
But they do care very very much so obviously they DO pay the tax.
Granted, some taxes do get passed on to the customer ... but not all. Corporate income taxes can't be passed on to the consumer because they are figured on the companies profit and they only have a profit ( hopefully ) AFTER the customer has paid. The only taxes that get passed on are those that can be figured into the cost of goods / services sold.
Taxes based on profits can't be passed on.
Thus, companies threaten to move if a state / city doesn't give them a tax break, etc. etc. etc.
The old line that companies don't pay taxes is one more Republican lie.
Dale Whiting posted at 1:49 pm on Sat, Jul 30, 2011.
Ron, surely you jest!
Since when do politicians, either Republicans or Democrats, tell their constituents the truth? The last President caught telling us the truth was voted out of office and replaced by Ronald Reagan. The last Presidential Candidate caught telling us the truth was castigated by the press and now his son, Mitt Romney is running for President. Mitt learned his lesson the easy way.
Rich posted at 2:29 pm on Sat, Jul 30, 2011.
AZW, just read the P and L statements. It's either overhead or Cost of Sales. If the company makes a profit it doesn't pay taxes, just collects them and what it costs to do that is figured into their overhead so you pay more to give the government the same money. On public corporations it's right there in black and white, published read it.
Arizona Willie posted at 10:35 am on Sun, Jul 31, 2011.
Both overhead and cost of sale are expenses that are figured into whether or not the company made a profit. SOME taxes, such as taxes on their real estate and taxes on materials they purchase to create the companies product / service ARE included in their cost of goods sold but what remains after all that is called PROFIT. There is no way to add the tax on their profit onto the cost of the product they already sold. Understand that?
The tax they pay on their PROFIT < cannot > be passed on to the consumer because the consumer has ALREADY PAID.
If you paid $4 for a box of cereal General Mills does not come back and say you owe them $.14 ( fourteen cents for public school students ) more after they filed their taxes for the year.
sockratties posted at 9:31 am on Tue, Aug 2, 2011.
Corporate taxes are much like your own IRS form 1040 where it asks for “adjusted gross income.” This is where the difference between outgo and income shows up. After that comes deductions and exemptions then finally taxable income. Corporate taxes are computed in much the same way. Taxes withheld and taxes owed are summed to compute the tax obligation.
RE: GE… GE filed more than 7000 tax forms in 2010 and the New York Times tried to make it seem that GE didn’t pay any taxes. The number NYT used was one of the working numbers on the form and had nothing to do with a computed tax obligation.
GE will pay a healthy tax bill for 2010 just as they do every year. They also pay local city and state taxes, employee obligations, employee unemployment insurance, employee health insurance, facility and asset insurance, telephone fees and taxes, utility fees and taxes, local impact fees. And of course taxes are collected on the earnings of everyone they do business with. By the time a dollar spent on a GE product has completed its spending cycle and is ready to be spent on another product it has had about 80 cents siphoned off by the government in taxes and fees.
Incidentally, GE Capital Finance took a bath in the housing crash and their tax obligations include the write-off for those loses, the same as for individuals who had similar loses. Shareholders of GE also lost. Fortunately GE diversity will offset much of that grief. It’s typical of the media to go after a U.S. based company even if they have to distort the truth to do so. Thomas Edison must be rolling in his grave. No wonder so many so called American companies have decided to get out of Dodge.