" /> Cash Rich AT&T, Verizon, Time Warner Cable Form Astroturf Group to Demand Major Tax Cuts | Stop the Cap!

Home » Astroturf »Editorial & Site News »Public Policy & Gov't » Currently Reading:

Cash Rich AT&T, Verizon, Time Warner Cable Form Astroturf Group to Demand Major Tax Cuts

Phillip Dampier September 27, 2011 Astroturf, Editorial & Site News, Public Policy & Gov't No Comments

AT&T, Verizon, Time Warner Cable, and nine other giant corporations selling cigarettes, shoes, shipping services, and jet aircraft have formed a new group demanding major cuts in the corporate tax rate that would allow some of them to repatriate billions in cash reserves stuffed in overseas banks to dodge U.S. taxes.

RATE — the Reducing America’s Taxes Equitably Coalition, says cutting the corporate tax rate is key to increased spending of accumulated corporate dollars in the United States.

“In a global economy where capital is highly mobile, it is simply harder to compete from America,” the companies’ executives wrote in a letter. “A lower corporate tax rate will boost investment in the U.S., bringing more American jobs, innovation and growth.”

But many of these corporations already pay less taxes than you do as a percentage of income.  Take Verizon, which shovels substantial profits through its British wireless partner Vodafone through Luxembourg, at an effective tax rate of around 10%.

Forbes reports last year Verizon had sales of $108 billion.  It’s pretax income was $11.8 billion.  The company paid just $1.2 billion in income taxes thanks to its $42 billion wireless joint venture with Vodafone, which Forbes reports “draws off much of Verizon’s income.”  But that is hardly a bad thing for Verizon.  Its effective tax rate: 10.5%.  Most middle class Americans pay twice or more that rate.  Verizon itself was surprised it only paid that much, because it ended up getting a federal tax refund for an overpayment amounting to $705 million.

In 2010, AT&T got hit harder, but still managed to eke out a winning year for shareholders.  AT&T enjoyed sales of $123 billion.  Its pretax income: $19 billion.  The company ended up paying $6.2 billion in income taxes for an effective tax rate of 32.4%.  But their executives got the benefit of every tax loophole available for their personal tax returns, made possible by AT&T’s generous subsidy of up to $14,000 a year for each executive officer to hire the best tax accountants around.

American companies already pay the second lowest taxes in the developed world, once all of the loopholes and deductions in the corporate tax code are accounted for. American corporations are sitting on record amounts of cash, so its unclear why more cash (in the form of tax breaks) would lead to more hiring, unless it involves adding more Washington, D.C. lobbyists, of course.

Share






Search This Site:

Contributions:

Recent Comments:

  • Scott: Perfectly example of why I still don't subscribe to cable or satellite. The only channel I *might* watch out of that entire lineup is Comedy Central....
  • James Cieloha: CableOne, Service Electric, GCI, Buckeye and other NCTC members are being forced by Viacom to add the Epix movie channels in order to carry the cable ...
  • Dave Hancock: I don't know where AP lives, but in MOST areas of the country MOST people do not have any choice for High Speed Internet (15mbps or above) - it is the...
  • tacitus: That doesn't sound right. Are you in some sort of contract? Where in the country is this?...
  • AP: Good luck cutting cable if you live in an area that has one cable, internet, and phone company like I do. If you want internet or phone with the cable...
  • Dave Hancock: Soon the rest of the cable companies will follow Verizon's lead and start limiting the input bandwidth to their systems (ex: Netflix) to discourage su...
  • Milan in Austin: Cable TV is an obsolete product! I suggest everyone seriously consider dropping cable television. I cut the cord in August of 2013, and don't miss ca...
  • gsuburban: I have to agree that Verizon is not interested in providing its customers with a "clear pipe" due to the politics of peer-to-peer data sharing or what...
  • Scott: Not good, that takes away all your leverage in the situation. If you're holding the money you can work through the BBB or try and negotiate with the ...
  • Hudson Mohawk Press: We knew it couldn't last forever. Starting this month Time Warner Cable of NYC is charging Earthlink Internet customers a $5.99 modem lease fee. The w...
  • Eric: Frontier still sucks..Their service still sucks..they are still a ripofff...
  • punki: Thanks Scott, unfortunately mine is already paid......

Your Account: