Friday, March 25, 2011
Tax Breaks is our most important product
Long ago progress and the manufacturing of tangible assets were the prime efforts of General Electric. Nowadays their primary efforts are in the fields of offshoring jobs and tax avoidance. In fact, the GE tax avoidance department is currently the gold standard of such efforts in the trans-national corporate world.
The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.And they are leading the pack in calling for reductions in corporate taxes. They already have the individual tax payer paying the GE share of taxes, what more do they want?
Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion.
That may be hard to fathom for the millions of American business owners and households now preparing their own returns, but low taxes are nothing new for G.E. The company has been cutting the percentage of its American profits paid to the Internal Revenue Service for years, resulting in a far lower rate than at most multinational companies.
Its extraordinary success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. G.E.’s giant tax department, led by a bow-tied former Treasury official named John Samuels, is often referred to as the world’s best tax law firm. Indeed, the company’s slogan “Imagination at Work” fits this department well. The team includes former officials not just from the Treasury, but also from the I.R.S. and virtually all the tax-writing committees in Congress.
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