Most companies in US avoid federal income taxes

[revwardoc]

http://hosted.ap.org/dynamic/stories...ME_TAX?SITE=AP

WASHINGTON (AP) -- Two-thirds of U.S. corporations paid no federal income taxes between 1998 and 2005, according to a new report from Congress.

The study by the Government Accountability Office, expected to be released Tuesday, said about 68 percent of foreign companies doing business in the U.S. avoided corporate taxes over the same period.

Collectively, the companies reported trillions of dollars in sales, according to GAO's estimate.

"It's shameful that so many corporations make big profits and pay nothing to support our country," said Sen. Byron Dorgan, D-N.D., who asked for the GAO study with Sen. Carl Levin, D-Mich.

An outside tax expert, Chris Edwards of the libertarian Cato Institute in Washington, said increasing numbers of limited liability corporations and so-called "S" corporations pay taxes under individual tax codes.

"Half of all business income in the United States now ends up going through the individual tax code," Edwards said.

The GAO study did not investigate why corporations weren't paying federal income taxes or corporate taxes and it did not identify any corporations by name. It said companies may escape paying such taxes due to operating losses or because of tax credits.

More than 38,000 foreign corporations had no tax liability in 2005 and 1.2 million U.S. companies paid no income tax, the GAO said. Combined, the companies had $2.5 trillion in sales. About 25 percent of the U.S. corporations not paying corporate taxes were considered large corporations, meaning they had at least $250 million in assets or $50 million in receipts.

The GAO said it analyzed data from the Internal Revenue Service, examining samples of corporate returns for the years 1998 through 2005. For 2005, for example, it reviewed 110,003 tax returns from among more than 1.2 million corporations doing business in the U.S.

Dorgan and Levin have complained about companies abusing transfer prices - amounts charged on transactions between companies in a group, such as a parent and subsidiary. In some cases, multinational companies can manipulate transfer prices to shift income from higher to lower tax jurisdictions, cutting their tax liabilities. The GAO did not suggest which companies might be doing this.

"It's time for the big corporations to pay their fair share," Dorgan said.

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[Advisor]

Election year Bullsh*t. Much sound and fury signifying nothing. The boys 'n girls in DC aren't going to bite the hand that feeds 'em.

[SuperScout]

"It's time for the big corporations to pay their fair share," Dorgan said.

OK, Mr. Rocket Scientist: what constitutes a 'fair share'?

Why not save yourself the trouble, and work to enact the FairTax Plan that taxes only consumption, not income. The current tax code is so convoluted and corrupt that any good tax accountant can ususally find enough write-offs and loop holes that offset any income that a corporation might have. That very reason is why tax accountants exist - change the tax code and POOF!! they have to find another line of work. The FairTax Plan is the fairest, simplest way for the government to raise the revenue it needs, closes all the special-interest loop holes, helps to retire many lobbyists, and treats all consumers with equality.

[exlrrp]

Originally Posted by SuperScout

"It's time for the big corporations to pay their fair share," Dorgan said.

OK, Mr. Rocket Scientist: what constitutes a 'fair share'?

Why not save yourself the trouble, and work to enact the FairTax Plan that taxes only consumption, not income. The current tax code is so convoluted and corrupt that any good tax accountant can ususally find enough write-offs and loop holes that offset any income that a corporation might have. That very reason is why tax accountants exist - change the tax code and POOF!! they have to find another line of work. The FairTax Plan is the fairest, simplest way for the government to raise the revenue it needs, closes all the special-interest loop holes, helps to retire many lobbyists, and treats all consumers with equality.

I see Mr All Donkey-All Racist has another great scheme to get the wealthy out of paying their share. I guess Bush lowering the tax rates for the wealthy didn't pan out quite the way they hoped--- Unemployment is higher than when they started, Growth is lower than when they started. They doubled the national debt in 8 years---this is unprecedented. After 7.5 years of Bush and the Repuglican's economic Ponzi scheme policies, the country is in the economic worst shape since they started keeping records, so what do they do? come up with a NEW tax scheme.

The greatest ---and LONGEST!!--expansion this country ever had, 1945--73, came with a graduated tax---lets stick with whats known to work instead of taking off on another repuglican Ponzi scheme where in all debts will be paid by --SURPRISE!!-- the next generation. And the generation after that and the one after that.

As usual, The repuglicans want to cut taxes after running up the greatest public debt in history: its DOUBLED after their Super-taxcut that was supposed to solve all problems. And now they have a glittering NEW tax scheme that will solve all problems. Does it start paying down the Repuglican debt? If not, then just shitcan it where it belongs!

Pay your dam taxes and quit crying about them!! Just call it the cover charge for living in the in the best country in the world


Revwardoc:
Your title is off, it should be most CORPORATIONS, not companies, avoid paying taxes---there's a difference. When I was in businesss I was a sole proprietor, not a corporation---it avoided double books/double taxation that goes with being a corporation.

Corporations shoulc pay income tax because they are treated as individuals. Corporations are seperate entities, they have "freedom of speech" by making political contributions. The only real reson to incorporate is to limit the liabilities of stockholders. As such, thery MUST be taxed, it takes money to police and regulate all this, it doesn't come from nowhere, as repuglicans like to pretend.

Mr All Donkey/Alll Racist is right this far--a good accountant knows how to get around the tax law but he's off on his usual inanities to suggest a "Fair Tax" law would put them out of work. They'll just start working on subverting that one too.

It just goes to show that the rich have gotten richer under the Bush administration, but thats old news