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Wed Jul 29, 2015, 08:06 PM

How Big Corporations Are Starving Public Schools of Billions of Dollars


By Paul Buchheit, a college teacher, a member of US Uncut Chicago, and the editor and main author of American Wars: Illusions and Realities (Clarity Press). He can be reached at [email protected] Originally published at Alternet


Corporations have reaped trillion-dollar benefits from 60 years of public education in the U.S., but they’re skipping out on the taxes meant to sustain the educational system. Children suffer from repeated school cutbacks. And parents subsidize the deadbeat corporations through increases in property taxes and sales taxes.

Big Companies Pay about a Third of their Required State Taxes

An earlier report noted that 25 of our nation’s largest corporations paid combined 2013 state taxes at a rate of 2.4%, a little over a third of the average required tax. Many of these companies play one state against another, holding their home states hostage for tax breaks under the threat of bolting to other states.

Without Corporate Taxes, K-12 Public Education Keeps Getting Cut

Overall spending on K-12 public school students fell in 2011 for the first time since the Census Bureau began keeping records over three decades ago. The cuts have continued to the present day, with the majority of states spending less per student than before the 2008 recession.

It’s Getting Worse

Total corporate profits were about $1.8 trillion in 2013 (with other estimates somewhat higher or lower). The $46 billion in total corporate state income tax in 2013, as reported by both Ernst & Young (Table 3-A) and the Census Bureau, amounts to just 2.55% of the $1.8 trillion in corporate profits, a drop from the 3% paid in the five years ending in 2012.

The Worst Offenders

The most recent Pay Up Now analysis for 2014 shows some of the biggest and the worst offenders among U.S. corporations in 2014. Twenty companies with total U.S. profits of over $150 billion paid just 1.4% in state taxes. Some of the lowlights:

• Three of the largest California companies (Google, Intel, Wells Fargo) paid just 1.4% of their profits in state taxes. That’s less than 1/6 of the required California rate. Apple, which paid about half of its required state taxes in 2014, shamed itself by claiming residency in tax-free Nevada to avoid California’s high rate.
• Texas has a modest franchise tax instead of a state tax, but two giant firms (Exxon and AT&T) still managed to claim sizable state tax credits. Exxon, which has almost 80% of its productive oil and gas wells in the U.S., declared only 17% of its income here, while using a theoretical tax to account for 83% of its smallish federal income tax bill. On the state side, the company received hundreds of millions in subsidies for its refineries in Louisiana.
• In Illinois, a state beleaguered by pension woes and the nation’s worst per-student spending cuts in 2011-12, lost nearly a billion dollars in tax revenue to just six companies (Boeing, Archer Daniels, Walgreen’s, Caterpillar, Exelon, Abbott Labs), which paid just 1.9% of their profits in state taxes, about a quarter of the required amount.
• New York’s most notorious tax avoider is Pfizer, which had nearly half of its sales in the U.S. over the past three years, yet claimed $50 billion in foreign profits and losses in the U.S.


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http://www.nakedcapitalism.com/2015/07/how-big-corporations-are-starving-public-schools-of-billions-of-dollars.html




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Reply How Big Corporations Are Starving Public Schools of Billions of Dollars (Original post)
marmar Jul 2015 OP
Igel Jul 2015 #1

Response to marmar (Original post)

Wed Jul 29, 2015, 11:25 PM

1. If they don't pay their required taxes, it's tax evasion.

And they tend to get charged with tax evasion and made to pay up.

They don't pay taxes they don't owe. Yes, they take advantage of the law. Then again, I claim all the deductions I reasonably can. I know others who claim every deduction their tax accountant (they only have an accountant for having their taxes done in the spring) says they can.

If they don't owe the taxes, perhaps the problem isn't the accountants but the legislators. But the problem is as true in (D) states as (R) states, so instead of eating our own we prefer to focus on those who act pretty much the same way we act but which are not-us.

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