I am a big fan of The Daily Show, and last night Jon Stewart reported that GE paid no corporate taxes last year, on earnings or something like $6 billion.
That sounds pretty outrageous, and I felt pretty outraged.
But then I started to think this through.
I assume that GE has at least one full-time employee, therefore GE is required to “contribute” 8% of that employees FICA payment, up to something like $8,000 out of $100,000 in income… so right there, well, maybe not a whole lot, but they did have to pay some federal taxes.
I also assume that, if they made money, they must’ve paid out something to their stockholders, and I would assume that somewhere, some capital gains taxes were charged to someone.
And, I assume that every once in awhile the office managers did runs to Staples and bought stuff, and paid local sales tax when they did so. And if they own any buildings, they had to pay local property tax, if they own any vehicles, they had to pay excise tax on them, plus if they bought gas they paid a tax on that.
So now I am confused. Here I am being told from numerous sources that GE paid no taxes, but I think this applies just to one particular type of tax, i.e., corporate tax, whatever that is.
I have no doubt that large corporate entities are doing whatever they can to get whatever tax breaks they can through lobbying and campaign contributions, and that they have a phalanx of CPA's to take advantage of every loophole they can find. And at some level it’s probably unfair to someone. However, this simplistic statement that “they paid no taxes” doesn’t really help the situation. Because right after I feel outraged, I also feel completely powerless. If we were presented with a complete picture of how all the income taxes paid by GE employees added up, along with the sales taxes and capital gains taxes, then we might have the beginnings of a productive discussion. Instead, even my favorite news outlet is telling me that “corporate fatcats are screwing you and there’s nothing you can do about it.”
And we wonder why the political discourse is so strident.
© Justin Locke
