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Tilted Cat Head
Administrator
Location: Manhattan, NY
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Most companies paid no taxes during the boom
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Most companies paid no taxes during the boom
With corporate tax receipts at 20-year low, the GAO takes a look through the books and finds 94% of all U.S. companies paid less than 5% -- and 61% paid nothing at all.
By MSN Money staff and news services
Think about this as you sign that check to Uncle Sam next week: More than 60% of all U.S. companies paid no federal tax at all during the boom years of 1996 to 2000, the General Accounting Office reports.
In 2000 alone, 94% of all U.S. corporations paid less than 5% of their total income in corporate taxes, the GAO said in a report released Friday. Among the largest corporations -- the 1% of all corporations that owns 93% of all corporate assets -- 82% paid less than 5% of their income in taxes.
And it wasn’t just American companies avoiding a bill. About 70% of foreign-owned companies doing business in the United States paid no federal tax in the late 1990s, the GAO said. The GAO report covered 2.1 million returns by U.S. companies and 69,000 foreign-owned companies.Fast and easy.
E-file your taxes
at H&R Block.
The federal corporate tax rate is 35%, but tax credits and loopholes can dramatically shrink the tax bill. Companies may not report U.S. income tax because of current-year operating losses, losses carried forward from preceding tax years, tax credits and improper pricing of intercompany transactions.
They're big on refunds, though
Corporations are also footing less of the total tax bill. In 2003, corporate taxes were 7.4% of overall receipts, the lowest level since 1983, IRS data show. Individual taxpayers forked up 45%, with the rest coming from employment and excise taxes.
Despite that, more than 21% of the $302 billion in tax refunds distributed last year went to corporations, IRS data show.
Companies with a tax bill of zero
Tax year Foreign returns U.S. returns
1996 46,791 (67.6%) 1,360,566 (60.3%)
1997 50,625 (71.7%) 1,331,638 (60.9%)
1998 50,671 (71.8%) 1,335,000 (61.0%)
1999 50,149 (72.3%) 1,310,280 (61.2%)
2000 50,688 (73.3%) 1,332,239 (63.0%)
Source: General Accounting Office
'Gaping loopholes'
The study was requested by Democratic senators Byron Dorgan of North Dakota and Carl Levin of Michigan as a follow-up to one done in 1999 and confirmed the earlier findings.
Dorgan said the results showed Congress needed to make major changes in U.S. tax laws to close "gaping loopholes," that allowed foreign-owned companies "to move billions of dollars in profit overseas, on income generated in the United States."
"They don't pay their fair share, and the net result is that average taxpayers -- working families -- wind up paying more to make up that difference," Dorgan said.
President Bush's budget forecasts corporations will pay $168.7 billion in income taxes in 2004 compared with $765.4 billion paid by individuals.
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This irritates me. I mean really really iritates me.
If you look at some of your bills, namely the telephone bill, look at for the GROSS RECIEPTS TAX. Know what that's for? It's the the CONSUMER paying the taxes on the total income of the phone companies profits. Yeah, I pay for it, you pay for it. WTF?
I read this and during the MOST PROFITABLE time in history almost NO taxes we paid??? I know there are some incentives etc to build business, but jeez, it just seems a little much.
Something to think about if you happen to be paying taxes in the next coming week.
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