Although it varies by municipality, the average effective income tax rate is nearly 5 percent – again, the highest of any state.
Advertisement
The GAO said there were several reasons why profitable businesses may not have owed taxes. Brian Schatz, D-Hawaii, and Rep. Jan Schakowsky, D-Ill., introduced the Corporate Tax Dodging Prevention Act to prevent profitable corporations from receiving tax breaks by sheltering income in Panama, the Cayman Islands, Bermuda and other offshore tax havens.
Individual income tax as a fraction of personal income.
Of those large corporations whose financial statements reported a profit, 19.5 percent paid no federal income tax that year. Bernie Sanders (I-VT) and the Occupy Wall Street crowd for the rich to pay more in taxes, wealthy Americans already pay almost 87 percent of all federal income tax.
Businesses must also pay state and local taxes, while companies that operate overseas are on the hook for taxes in those countries. “The U.S. tax system has not been updated in 30 years and isn’t designed for today’s economy, which is why we support comprehensive tax reform – even if it raises our tax rate”, he said in an op-ed in The Washington Post.
Advertisement
At least two-thirds of all active USA corporations paid nothing in federal income taxes during the 2006-12 period, despite an income-dependent statutory tax rate of 15 percent to 35 percent, the Government Accountability Office said in a report released Wednesday. The 58 percent of big businesses that did pay taxes in 2012 contributed a total of $268 billion. As the presidential race intensifies, experts agree the issue is likely off the table until after the election in November.
