While millions of Americans had to cut Uncle Sam a check this year to pay their tax bill, 60 of the Fortune 500 companies paid zero taxes on their revenue, a new report finds.
In 2018, 60 of America’s biggest corporations zeroed out their federal income taxes on $79 billion in US pretax income. Instead of paying $16.4 billion in taxes at the 21 percent statutory corporate tax rate, these companies enjoyed a net corporate tax rebate of $4.3 billion, according to a study by the Institute on Taxation and Economic Policy (ITEP).
One of the biggest names on the list is Amazon. The retail giant reported $11 billion in US revenue and claimed a federal income tax rebate of $129 million, giving Jeff Bezos an effective tax rate of -1 percent.
Amazon was able to reduce its income tax by more than $1 billion in 2018 by using a tax break for stock options given to its executives.
Streaming service Netflix paid no federal income tax on $856 million of US income.
Netflix was able to reduce its tax bill to the feds by $191 million using the stock option tax break, making its effective tax rate -3 percent.
The companies reportedly paying $0 in federal income taxes for 2018 besides Amazon and Netflix include IBM, Halliburton, Chevron, Deere, Delta Air Lines, General Motors, Honeywell, Prudential Financial, and Whirlpool. Many of the companies will be getting an actual refund from Uncle Sam.
The ITEP explained that many of these companies use a wide variety of tactics to avoid paying taxes including utilizing tax rebates and credits that are specific to their industries.
“There’s no indication that any of these companies are doing anything illegal,” said Matthew Gardner, a senior fellow at the ITEP. “By all accounts, they’re simply using tax breaks that Congress and various presidents have chosen to make available.”
With Post wires