Many of the nation’s largest, most profitable companies are paying little or no federal income taxes, according to a study released today by Citizens for Tax Justice (CTJ) and the Institute on Taxation and Economic Policy (ITEP). Major Oregon employers Intel and Kroger – owner of the Fred Meyer grocery chain – were among those corporations paying less than half the statutory 35 percent tax rate on their profits from 2001 to 2003. Intel paid federal taxes equaling just 15 percent of company profits over 2001-03. Kroger paid 16.6 percent.
Download a copy of this news release:
“Intel alone received federal income tax breaks worth nearly 2 billion dollars in the 2001 to 2003 period,” said Charles Sheketoff, executive director of the Oregon Center for Public Policy.
“Oregon voters and legislators should take note when big Oregon companies like Kroger and Intel escape their federal tax liability. It should get them to question whether Oregon should give them more tax breaks like the kicker,” he said. The latest revenue forecast projects that corporations will receive a $68 million kicker tax cut next year, with 90 percent of the tax cut going to fewer than four percent of Oregon’s corporations.
The CTJ/ITEP study examined the federal income taxes paid by 275 of the country’s largest, most profitable companies and found that the overall effective tax rate on these companies between 2001 and 2003 was 18.4 percent, nearly half the statutory 35 percent rate. “At what ought to have been a time of national sacrifice, many companies with the clearest ‘ability to pay’ shirked their duty,” said Sheketoff.
Nearly a third of the companies paid zero taxes or received a rebate in at least one year between 2001 and 2003. Companies with a presence in Oregon, including Verizon, AT&T, and Boeing, were among the companies paying next to nothing or receiving rebates in 2001 through 2003. Sheketoff noted that two-thirds of Oregon’s corporations pay Oregon’s $10 corporate minimum tax.
“The data indicate that in 2003, the average American taxpayer paid more federal income taxes than AT&T, Time Warner, and Walt Disney combined,” said Sheketoff. “When large corporations receive so much in tax subsidies, American families must pick up the slack.”
The Oregon Center for Public Policy uses research and analysis to advance policies and practices that improve the economic and social opportunities of low- and moderate-income Oregonians, the majority of Oregonians.