Working families pay their taxes while large corporations receive government handouts. It's time to end corporate welfare.
Some of the world’s largest corporations are getting away with not paying their fair share in taxes. In Oregon, most corporations pay the minimum tax and our corporate minimums are low. To make the tax disparity even worse, many corporations use every trick in the book to avoid paying the low taxes they owe. For example, in Oregon in 2012, more than 300 corporations managed to pay $0 in income taxes in Oregon, and between 2008 and 2012, at least 26 Fortune 500 companies paid no net federal income tax. (Notable corporations on that list include PG&E, the national energy company; General Electric; Con-Way; Verizon; and Boeing.)
[T]he average American family pays $6,000 a year in corporate subsidies
They get out of taxes because they have teams of accountants that exploit every loophole in the tax code. Last week, we exposed the large corporations that use off-shore tax havens to hide their tax obligation, and today we’re diving into corporate subsidies.
Subsidies aren’t necessarily a bad thing. Families that are struggling to get by demonstrate their need and receive some assistance to help make ends meet. That’s a subsidy that works. Corporate subsidies, on the other hand, give handouts to corporations with usually no accountability that they do anything to help the economy. If done right, a subsidy would support struggling industries, create new jobs, or fund important research. Problem is, they often serve no other purpose than to increase a corporation’s bottom line. As if giving the world’s largest corporations the upper hand over over small businesses weren’t bad enough, working families are the ones funding corporate welfare. In fact, the average American family pays $6,000 a year in corporate subsidies. We’re paying more in taxes so that corporations can receive handouts, and we’re losing out on tax dollars sorely needed for schools, healthcare and other critical public services.
So just how much corporate welfare are we talking about here?
Citizens for Tax Justice studied 288 corporations, and found that between 2008 and 2012, they received an eye-popping $364 billion in federal tax subsidies while reporting a total income of $2.3 trillion. More than half of the subsidies went to just 25 of the world’s largest and most powerful corporations, including Wells Fargo ($21.6 billion); AT&T ($19.2 billion); IBM ($13.2 billion); General Electric ($12.7 billion); Exxon Mobil ($8.7 billion); J.P. Morgan Chase ($5.9 billion); Walmart ($5.1 billion); Chevron ($4.5 billion); Goldman Sachs ($4.1 billion); and Intel ($3.8 billion).
And according to Good Jobs First’s Subsidy Tracker, over the past 20 years, Oregon has handed out more than $6.6 billion in corporate welfare, placing us in 8th place among the states for subsidies given. The biggest beneficiaries in Oregon are Intel ($3.1 billion); Nike ($2.0 billion); Google ($360 million); SK Holdings ($121 million); Avago ($113 million); Berkshire Hathaway ($42 million); Iberdrola ($34 million); Portland General Electric ($34 million); Caithness Energy ($30 million); and Koch Industries ($25 million).
Some of the world’s largest, most powerful corporations are receiving public assistance, at a time when corporate profits have never been higher, and many working families are still struggling to recover from the 2008 recession. The billions of dollars of handouts they’re taking aren’t stimulating the economy. By taking the hard-earned dollars of working people, dollars that should go toward the things working families need, corporate subsidies are exacerbating the problems our economy is facing. It’s time for corporations to start paying their fair share so our communities can have the schools and services we deserve.