Tag: tax

Not All Pirates Are in Somalia (via Off the Top o’ My Head)

On By southwerkIn business ethics1 Comment

This is some great writing. Many people are upset by the enormous salaries that CEO’s are pulling down and have conveyed their rage online. But few have explained the mechanics of the corporate system that make these salaries possible.

I visited “Off the Top o’ My Head.” I was impressed by the writing. This is a thoughtful author and he brings legal elements into his reasoning but not too much. The writing is very approachable. You should give this site a visit.

This is his business page.

James Pilant

General Electric Co. made news last month when it reported U.S. profits of $5.1 billion and worldwide profits of $14.2 billion, but paid no federal corporate income tax. GE even reaped a net tax benefit of $3.2 billion. What the newsies do not mention is that the government additionally subsidized the ridiculous wealth GE and other corporations lavish on their executives. Uncle Sam must miss a lot of sleep staying up nights to figure out how to p … Read More

via Off the Top o My Head

In South Carolina, Business Tax Cuts on Unemployment Funding Come Back to Bite!

On By southwerkIn business ethics

What happens when a state has paid out huge amounts of money for unemployment that they cannot afford? South Carolina decided to make up the shortfall by having businesses pay back the money used .

This is a wonderful video. The businesses go through their usual song and dance. 1) We are surprised by this tax increase. 2) It’s monstrous. 3) It’s the unemployed’s fault. 4) It’s not our fault. And the utterly inevitable 5) We are going to cut back on hiring and expansion. Surprise, fear, blame shifting, innocence and revenge. They should get a new writer.

How many of these people, these businesses, gave a thought for one moment whether or not unemployment was properly funded? How many of them screamed foul when their taxes to pay unemployment were cut?

By the way, please note the complete lack of balance or even a simple inquiry into the facts of the matter by the “news” station.

They simply aired what is essentially a little pro-business PR piece.

James Pilant

And They Don’t Pay Their Share Of Taxes Either

On By southwerkIn business ethics, Capitalism, Economic measurement, ethics, Government Failure

I wrote in the previous post about how the fifty companies that laid off the most workers paid their CEO’s a total of 598 million dollars. But if you read the study itself, you discover that they also shirk their duties as good corporate citizens.

This is from the study –

Under current law, U.S. corporations face a 35
percent statutory tax rate on corporate profits. Of the 50
layoff leaders, only two reported paying this statutory
rate in 2009 and most paid substantially less, according
to an IPS analysis of domestic earnings and federal tax
payments in company 10-K reports.20 Hewlett-Packard,
under Hurd, remitted $47 million in federal corporate
income tax, a mere 2 percent of the company’s reported
$2.6 billion in pretax domestic net income.


Citizens for Tax Justice has used forensic accounting
methods to demonstrate that corporations
often pay an even lower tax rate than they report to
the SEC. Overall, as a result of various tax avoidance
schemes, U.S. corporate income taxes have plummeted
from almost a third of all non-Social Security federal
tax revenues in the 1960s to only a sixth of total taxes
today.22

In some extreme cases, major U.S. corporations
are actually paying less in taxes to Uncle Sam than
they pay, in compensation, to their CEOs. At Occidental
Petroleum, for instance, CEO Ray Irani made $31.4
million last year. That represented almost twice as much
as the $16 million the international oil firm paid in federal
corporate income tax for all the services the federal
government provides.

It is almost too obvious to mention that when corporations avoid their taxes, the burden falls on the middle class.

What is meant by CSR, corporate social responsibility? Are they just code words, that mean, “Get off my back and stop complaining,” or “Can’t you crazed citizens and nosy government officials recognize our good works and let the magnificent engine of capitalism grind on?”

I wonder if it is just a public relations thing. I bet you do too.

James Pilant