RE: 'What's an "American" corporation?' [Village News, Opinion, 4/26/07]
Last updated 5/10/2007 at Noon
In her letter, Anna Monday asks, “Do ‘our’ (American) corporations contribute to the national wealth?” She went on to state: “If they pay taxes at all, they pay at a lower rate than do individuals. Many even incorporate offshore to avoid taxes.” Aha, I thought; at last, something useful to do with the corporate annual reports that pile up on my den table at this time of year: I can use them to answer Anna’s question. So I selected the top six off of the pile and here is what I found:
All six corporations are incorporated in Delaware and have their headquarters in the US. All six paid US income taxes in 2006, as follows (in the order I picked them up): Citigroup, $8.1B (billion) in taxes on net income of $30B; Chevron, $15B in taxes on $32B in income; DuPont, $196M (million) on $3.3B; Boeing, $988M on $3B; Intel, $2B taxes on $7B income; and JP Morgan Chase, $6.8 B on $14.4B. All of these are in the 30 to 45 percent tax rate range, except for DuPont. In 2005, DuPont paid $1.5B on $3.6B in net income.
Taken together, these six corporations paid $33.1B in 2006 taxes on a net income of $89.7B, representing a 37 percent tax rate, higher than the rate paid by most individuals. These taxes are a substantial contribution to government income over and above the salaries paid and the wealth created by the products produced by these corporations. I am sure that another six reports obtained from lower in the pile would produce similar results.
My information comes from audited reports filed with the Securities and Exchange Commission; where does Anna Monday’s come from?