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Baltimore, MD – A comprehensive new study from the Institute on Taxation and Economic Policy while profiles the 265 consistently profitable Fortune 500 corporations finds that 68 companies paid no state corporate income tax in at least one of the last three years and 20 of these corporations averaged a tax rate of zero or less during the 2008-2010 period.
“Individual taxpayers and small businesses in Maryland end up having to pick up the tab when these corporations avoid paying their taxes,” said Jenny Levin at Maryland PIRG.
The report, “Corporate Tax Dodging in Fifty States, 2008-2010” was produced by the Institute on Taxation and Economic Policy (ITEP) and released today in conjunction with Maryland PIRG. It examines Fortune 500 companies that filed SEC filings with required information on total state taxes paid that year. Only companies that reported profits all three years were included in the study. Lockheed Martin, headquartered in Maryland is one company covered in the report. It reported annual profits each year from 2008 to 2010, netting over $13 billion during the period, and paid 3.9 percent in state taxes across the nation.
“Our report shows these 265 corporations raked in a combined $1.33 trillion in profits in the last three years, and far too many have managed to shelter half or more of their profits from state taxes,” said Matthew Gardner, Executive Director at the Institute on Taxation and Economic Policy and the report’s co-author. “They’re so busy avoiding taxes, it’s no wonder they’re not creating any new jobs.”
The report finds that 68 of the 265 companies managed to pay no state income tax at all in at least one year from 2008 through 2010, despite telling their shareholders they made almost $117 billion in pretax U.S. profits in those no-tax years. Some companies, such as DuPont, Goodrich, International Paper and Intel, paid no net state income tax over the full three-year period.
Maryland PIRG own study last year on the use of offshore tax havens found that household tax filers in Maryland pay on average $472 in additional federal taxes to make up for revenue lost due to use of offshore tax havens. That report, titled How Much Did Offshore Tax Havens Cost You in 2010 can be found at this link.
“Companies should thrive based on how productive and innovative they are. Not based on their aggressive tax lobbyists and lawyers.”
Because few states have transparency regarding business taxes, it is not possible to determine specific tax amounts paid by corporations to individual states. All figures in ITEP’s report “Corporate Tax Dodging in Fifty States, 2008-2010” are aggregate for taxes paid to all U.S. states by each corporation.
The new ITEP study is online at http://www.ctj.org/corporatetaxdodgers50states/
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