Bernie Sanders' Top 10 Tax Avoiders

[one...two...tree 2,762]

In a Sunday press release calling on wealthy individuals and corporations to pay their share, Senator Bernie Sanders of Vermont offered a list of what he calls "some of the 10 worst corporate income tax avoiders."

Sanders, you'll recall, made headlines for his epic 8.5-hour speech/filibuster this past December, dealing with how Obama's pending tax-cut deal with the GOP would be bad for America. The speech—published this month as a paperback simply titled The Speech—was in vain: Congress passed the deal, extending tax breaks not merely to the poor and middle-class, but to America's richest people.

It also slashed the estate tax from 55 percent to 35 percent and exempted the first $5 million of an estate's value ($10 million for a couple)—up from $1 million pre-Bush. In his speech, Sanders warned against this change, noting, "Let us be very clear: This tax applies only—only—to the top three-tenths of 1 percent of American families; 99.7 percent of American families will not pay one nickel in an estate tax. This is not a tax on the rich, this is a tax on the very, very, very rich. (Click here for our blockbuster charts showing just how rich the very, very, very rich actually are.)

If the estate tax—which Republicans have cleverly rebranded the "death tax"—were to be eliminated entirely (another GOP goal), Sanders says it would cost US taxpayers $1 trillion over 10 years. "Families such as the Walton family, of Walmart fame, would have received, just this one family, about a $30 billion tax break," he said in the speech.

As one of few voices in Congress calling seriously for balance between cuts and new revenues, Sanders wants to close corporate tax loopholes and get rid of tax breaks for Big Oil. He's put forth a bill that would impose a 5.4 percent surtax on household income north of $1 million, and earmark that money for deficit reduction. He estimates it would bring in $50 billion a year, whereas Congress' recent tax-cut deal will add around $700 billion to the deficit.

So, without further ado, here's Bernie's tax-avoiders list. If you have any quibbles with his facts, let us know in the comments.

1) ExxonMobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings. [Note: Our post last April reported that ExxonMobil was owed $46 million by the IRS.]

2) Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion.

3) Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS.

4) Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009.

5) Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year.

6) Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction.

7) Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department.

8) Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury.

9) ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2007 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction.

10) Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.

Michael Mechanic is a senior editor at Mother Jones.

http://motherjones.com/mojo/2011/03/bernie-sanders-top-10-tax-avoiders

[ready4ONE 5,400]

These Corporations are merely taking advantage of their rightly earned child tax credits. Their profit doesn't really exist you know? Ask Gary.

[lostinblue 1,989]

Steve must have never collected a refund on overpayment of taxes.

[one...two...tree 2,762]

Steve must have never collected a refund on overpayment of taxes.

Eureka! You said my name! After all these years of you posting in OT and now in P&R, it's like we're old friends, except, I don't know your name. In fact, I don't know anything about you. You have been one of the most elusive members here. I don't recall you ever mentioning much anything about yourself. I respect that members want to protect their privacy, but no one's is going to hunt you down by sharing with us things like your first name, what line of work you do, or you immigration experience.

So come on, mystery man. Open up a little here. You've been long enough, you should feel safe now.

Edited March 30, 2011 by 8TBVBN

[Mr. Big Dog 10,747]

Okay, so help me out here: How would lowering the corporate income tax rates spur employment? At 35%, they pay nil. Arguably, at 15% they'd be paying nil. No benefit to them and hence no incentive to beef up hiring as far as the eye can see...

[Brother Hesekiel 2,235]

Okay, so help me out here: How would lowering the corporate income tax rates spur employment? At 35%, they pay nil. Arguably, at 15% they'd be paying nil. No benefit to them and hence no incentive to beef up hiring as far as the eye can see...

Easy.

See, the rulers of this country, the multi-national corporations, the ones that tell the President of the United States what he has to say, to sign, and to do, pay nothing. That won't change. But the second ones in line, the corporations that have not absolute power and pay a little bit of money, want a larger slice of the cake as well. Those corporations will benefit from a reduction of the corporate tax rate, and those corpses "invest" millions in their favorite politicians' campaigns as well.

[misterbigtoe 45]

Okay, so help me out here: How would lowering the corporate income tax rates spur employment? At 35%, they pay nil. Arguably, at 15% they'd be paying nil. No benefit to them and hence no incentive to beef up hiring as far as the eye can see...

Flamers take aim!

Corporations never pay corporate income taxes...........whether large multinational puppet-masters or small mom and pop s-corps. The puppet-masters take their cut as do mom and pop and any added costs(including corporate taxes) are passed to the consumer of the goods or services being sold by the corporation. Higher corporate income tax rates simply....very simply ALWAYS result in a higher cost for the individual and at the same time less money in his pocket to spend on the higher cost good. More money left in the pocket of the guy on the street results in more consumer spending on less expensive goods, more consumer spending results in higher demand for goods. Higher demand for goods and services results in higher production. Higher production results in hiring. Lower corporate rates also reduce the incentive for corporations to choose offshore locations in which to conduct business. Yes yes yes this is oversimplified, but still fundamentally correct

Raise the corporate rate for

1) ExxonMobil and the guy on the street pays more for fuel and anything manufactured of or wit petrochemicals. Also you pay more for anything that requires transport in anything that requires fuel or petrochemicals to operate. It is a vicious pyramid of cumulative cost.

2) Bank of America and the uy on the street earns less on accounts and pays ore for services as do companies for cmmercial banking services which are also passed on to their consumers.

3) General Electric and the guy on the pays more for his coffee maker and more in taxes to finance higher costs of military goods sold to Uncle Sam.

4) Chevron see #1.

5) Boeing, and it costs me and every other dufus on two legs more for airline tickets and taxes.

6) Valero Energy, see #1.

etc.................

Fundamentally, Corporations do not pay taxes, they are merely collection agents of taxes for your Uncle. They collect those taxes from ALL of us on behalf of our benevolent bureaucracy. Furthermore, if you hold stock directly or indirectly via mutual fund or other investment vehicle that hold such stock in any of the list of ten that Steve posted, then YOU are the corporation.

Edited March 31, 2011 by misterbigtoe

[mawilson 2,133]

any added costs(including corporate taxes) are passed to the consumer of the goods or services being sold by the corporation

Sorry but that's BS. Corporations can only charge so much for their

products - the consumers' wallets are not infinite.

If corporations could easily "pass on" any tax increases to the consumer,

what's stopping them now from increasing their prices and improving their

bottom line "just because"?

[misterbigtoe 45]

Sorry but that's BS. Corporations can only charge so much for their

products - the consumers' wallets are not infinite.

If corporations could easily "pass on" any tax increases to the consumer,

what's stopping them now from increasing their prices and improving their

bottom line "just because"?

Brilliant! You are helping me to make my argument for why corporations go offshore taking jobs with them.

Customers wallets are in fact not infinite and when a business can no longer raise prices to remain in the black, in this case under under regulatory (gov't) fiscal pressure, they must reduce cost and one effective way to do this is to...........move to a lower cost community.........state or country! Illnois is learning the truth of this as we speak. No different that if the cost of a raw material becomes too expensive, the business will find a lower cost alternative..........the cost of labor becomes too expensive............find a lower cost alternative. Fundamentally, corporations are nothing.........they are ethereal entites owned by shareholders each of whom expect a small return on each of share of stock. The shareholders also usually expect to be able to put aside a part of the total aggregate profit for future research and development so that their investment can continue to give returns into the future.

What is stopping them is their board of directors and responsibility to the shareholders. If you own stock or any type of mutual funds...........401K, etc, this means YOU!

Thanks for helping to make my point.

Edited March 31, 2011 by misterbigtoe

[Mr. Big Dog 10,747]

Sorry but that's BS. Corporations can only charge so much for their products - the consumers' wallets are not infinite.

If corporations could easily "pass on" any tax increases to the consumer, what's stopping them now from increasing their prices and improving their bottom line "just because"?

Bingo!

[Mr. Big Dog 10,747]

Corporations never pay corporate income taxes...........whether large multinational puppet-masters or small mom and pop s-corps. The puppet-masters take their cut as do mom and pop and any added costs(including corporate taxes) are passed to the consumer of the goods or services being sold by the corporation. Higher corporate income tax rates simply....very simply ALWAYS result in a higher cost for the individual and at the same time less money in his pocket to spend on the higher cost good. More money left in the pocket of the guy on the street results in more consumer spending on less expensive goods, more consumer spending results in higher demand for goods. Higher demand for goods and services results in higher production. Higher production results in hiring. Lower corporate rates also reduce the incentive for corporations to choose offshore locations in which to conduct business. Yes yes yes this is oversimplified, but still fundamentally correct.

You're missing the point entirely. If a corporation has a zero tax liability at the current 35% corp income tax rate, how will a lower corp income tax rate help that corporation? The tax liability will NOT change with the lower tax rate. It will still be zero. Hence, it will have zero effect on that corporation's hiring decisions.

And the argument that lower corp tax rates serve as an incentive for corporations to do business in the low tax location doesn't hold water either. Corporations might move on paper but the production goes where labor is cheap or available or qualified (depending on the type of production) or - in the case of resource extraction - where the resource is. The corporate income tax rate doesn't drive the decisions on where a company produces. Not even close. If that was so, if your stipulation would have any validity, then Ireland would be the booming economy in Western Europe - they've bought into the argument you're trying to sell here and introduced the lowest corp tax rates in the EU zone. And look how they're doing. Unemployment is higher than elsewhere, tax collections are lower than elsewhere and the country is needing to be bailed out by the higher corp tax rate countries in order not go bust.

Where are all the companies with all these jobs that would come if only the corp tax rates would be lowered? That's right, they are where countries maintain a qualified pool of people (read: where education is a priority), where countries maintain a viable infrastructure (read: invest in roads, rail and transit), where countries foster reasearch and development (read: invest in energy, medical, bio research). The low tax country isn't doing any of this because they can't fund it. So, what they end up with are a few headquarters (on paper, at least) but no staff.

The argument that you can create an environment for job creation by lowering taxes which neccessitates slashing government spending to the point that you can't maintain a modern infrastructure, educate the next generation of workers, look forward in terms of energy production and invest in future technologies is outright frivolous. What you're talking about then is trying to compete with a developing or emerging country. That's a competition that you don't even want to win because it means that you'd also have to compete with those wages. Are you ready to compete for a job with the guy over there in China making $3,000.00 a year. Good luck with that strategery...

Edited March 31, 2011 by Mr. Big Dog

[misterbigtoe 45]

You're missing the point entirely. If a corporation has a zero tax liability at the current 35% corp income tax rate, how will a lower corp income tax rate help that corporation? The tax liability will NOT change with the lower tax rate. It will still be zero. Hence, it will have zero effect on that corporation's hiring decisions.

And the argument that lower corp tax rates serve as an incentive for corporations to do business in the low tax location doesn't hold water either. Corporations might move on paper but the production goes where labor is cheap or available or qualified (depending on the type of production) or - in the case of resource extraction - where the resource is. The corporate income tax rate doesn't drive the decisions on where a company produces. Not even close. If that was so, if your stipulation would have any validity, then Ireland would be the booming economy in Western Europe - they've bought into the argument you're trying to sell here and introduced the lowest corp tax rates in the EU zone. And look how they're doing. Unemployment is higher than elsewhere, tax collections are lower than elsewhere and the country is needing to be bailed out by the higher corp tax rate countries in order not go bust.

Where are all the companies with all these jobs that would come if only the corp tax rates would be lowered? That's right, they are where countries maintain a qualified pool of people (read: where education is a priority), where countries maintain a viable infrastructure (read: invest in roads, rail and transit), where countries foster reasearch and development (read: invest in energy, medical, bio research). The low tax country isn't doing any of this because they can't fund it. So, what they end up with are a few headquarters (on paper, at least) but no staff.

The argument that you can create an environment for job creation by lowering taxes which neccessitates slashing government spending to the point that you can't maintain a modern infrastructure, educate the next generation of workers, look forward in terms of energy production and invest in future technologies is outright frivolous. What you're talking about then is trying to compete with a developing or emerging country. That's a competition that you don't even want to win because it means that you'd also have to compete with those wages. Are you ready to compete for a job with the guy over there in China making $3,000.00 a year. Good luck with that strategery...

No, I did not miss the point at all. I was however only speaking to the effect of corporate taxes on the business model which is dead-on. Your other points are all entirely valid unless you choose to isolate any one of them in a vacuum as I did with corporate taxes which were the point of Steve's original post. My second post in this thread just touched the fringe of a few of the myriad considerations businesses must make in choosing where to locate. Any one of those considerations if slightly less favorable with all others being equal likely will not cause a business to relocate but may in fact be the deal-breaker when it comes time for a new business startup to locate.