REPORT: You Have More Money In Your Wallet Than Bank Of America Pays In Federal Taxes

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US Uncut takes to the streets to fight for Main Street

By Zaid Jilani  | 26 February 2011

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Today, hundreds of thousands of people comprising a Main Street Movement — a coalition of students, the retired, union workers, public employees, and other middle class Americans — are in the streets, demonstrating against brutal cuts to public services and crackdowns on organized labor being pushed by conservative politicians. These lawmakers that are attacking collective bargaining and cutting necessary services like college tuition aid and health benefits for public workers claim that they have no choice but than to take these actions because both state and federal governments are in debt.

But it wasn’t teachers, fire fighters, policemen, and college students that caused the economic recession that has devastated government budgets — it was Wall Street. And as middle class workers are being asked to sacrifice, the rich continue to rig the system, dodging taxes and avoiding paying their fair share.

In an interview with In These Times, Carl Gibson, the founder of US Uncut, which is organizing some of today’s UK-inspired massive demonstrations against tax dodgers, explains that while ordinary Americans are being asked to sacrifice, major corporations continue to use the rigged tax code to avoid paying any federal taxes at all. As he says, if you have “one dollar” in your wallet, you’re paying more than the “combined income tax liability of GE, ExxonMobil, Citibank, and the Bank of America“:

[Gibson] explains, “I have one dollar in my wallet. That’s more than the combined income tax liability of GE, ExxonMobil, Citibank, and the Bank of America. That means somebody is gaming the system.”

Indeed, as politicians are asking ordinary Americans to sacrifice their education, their health, their labor rights, and their wellbeing to tackle budget deficits, some of the world’s richest multinational corporations are getting away with shirking their responsibility and paying nothing. ThinkProgress has assembled a short but far from comprehensive list of these tax dodgers — corporations which have rigged the tax system to their advantage so they can reap huge profits and avoid paying taxes:

– BANK OF AMERICA: In 2009, Bank of America didn’t pay a single penny in federal income taxes, exploiting the tax code so as to avoid paying its fair share. “Oh, yeah, this happens all the time,” said Robert Willens, a tax accounting expert interviewed by McClatchy. “If you go out and try to make money and you don’t do it, why should the government pay you for your losses?” asked Bob McIntyre of Citizens for Tax Justice. The same year, the mega-bank’s top executives received pay “ranging from $6 million to nearly $30 million.”

– BOEING: Despite receiving billions of dollars from the federal government every single year in taxpayer subsidies from the U.S. government, Boeing didn’t “pay a dime of U.S. federal corporate income taxes” between 2008 and 2010.

– CITIGROUP: Citigroup’s deferred income taxes for the third quarter of 2010 amounted to a grand total of $0.00. At the same time, Citigroup has continued to pay its staff lavishly. “John Havens, the head of Citigroup’s investment bank, is expected to be the bank’s highest paid executive for the second year in a row, with a compensation package worth $9.5 million.”

– EXXON-MOBIL: The oil giant uses offshore subsidiaries in the Caribbean to avoid paying taxes in the United States. Although Exxon-Mobil paid $15 billion in taxes in 2009, not a penny of those taxes went to the American Treasury. This was the same year that the company overtook Wal-Mart in the Fortune 500. Meanwhile the total compensation of Exxon-Mobil’s CEO the same year was over $29,000,000.

– GENERAL ELECTRIC: In 2009, General Electric — the world’s largest corporation — filed more than 7,000 tax returns and still paid nothing to U.S. government. They managed to do this by a tax code that essentially subsidizes companies for losing profits and allows them to set up tax havens overseas. That same year GE CEO Jeffery Immelt — who recently scored a spot on a White House economic advisory board — “earned total compensation of $9.89 million.” In 2002, Immelt displayed his lack of economic patriotism, saying, “When I am talking to GE managers, I talk China, China, China, China, China….I am a nut on China. Outsourcing from China is going to grow to 5 billion.”

– WELLS FARGO: Despite being the fourth largest bank in the country, Wells Fargo was able to escape paying federal taxes by writing all of its losses off after its acquisition of Wachovia. Yet in 2009 the chief executive of Wells Fargo also saw his compensation “more than double” as he earned “a salary of $5.6 million paid in cash and stock and stock awards of more than $13 million.”

In the coming months, politicians across the country are going to tell Americans that the only way to stave off huge deficit and balance the budgets is by gutting programs for the poor, eviscerating support for the middle class, eliminating labor rights, and decimating the government’s ability to serve the public interest. This is a lie. The United States is the richest country in the history of the world, and income inequality is higher now than it has been at any time since the 1920′s, with the top “top 1 percentile of households [taking] home 23.5 percent of income in 2007.”

It is simply unfair for Main Street Americans who’ve already been battered by one of the worst economic crises in our history to have to continue to sacrifice while the rich and well-connected continue to rip off taxpayers and avoid paying their fair share. That’s why a Main Street Movement consisting of Americans who are fed up with the status quo is rocking the nation, and one of its first targets should be tax dodgers like Bank of America and Boeing.

UPDATE

All across the country, Main Street Americans are protesting tax dodgers like Bank of America. A picture from one such demonstration (HT: @loril):

UPDATE

On its Twitter account, US Uncut notes that protesters outraged at Bank of America’s tax avoidance shut down a major branch in Washington, D.C. today.

UPDATE

Hundreds of demonstrators descended on a Bank of America branch in San Francisco, some carrying signs mocking the bank’s logo as “Bankrupting America” (HT: @jashsf):

UPDATE

One Uncut US demonstrator carried a sign that read: “I pay almost 1/3 of my measly income, Bank of America pays NOTHING?!!!” (HT: @allisonkilkenny):

UPDATE

This art school dropout in Maine was outraged at having to pay more taxes than Bank of America (HT: RawStory):

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Featured Comment: Tim McCafferty writes, “I just got back for a USuncut.org protest in front of the Pearl District BoA at 12th and Lovejoy in Portland, OR. About a hundred participants, it’s a start.”

Showing random select comments

lance peeples 02/26/2011 11:06 AM

• Apply the Alternative Minimum Tax (AMT) to corporations.
• Problem solved.
• Next?

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  39 people liked this. Like Reply

OutstandingInMyField 02/26/2011 11:46 AM in reply to lance peeples

• Best fix for this I’ve ever heard! After all, corporations are people, just like you and me.

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  30 people liked this. Like Reply

lancepeeples 02/26/2011 12:52 PM in reply to OutstandingInMyField

• I’m not a witch
• I’m Bank of America
• I’m you
• (except paying taxes is for “the little people”*)
• * the unincorporated

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blogbob 02/26/2011 02:48 PM in reply to lancepeeples

• Perhaps every household in America should run down to the local courthouse and incorporate. Then we can all pay no taxes…

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SharksBreath 02/26/2011 06:03 PM in reply to MoodyEllis

• We all pay federal taxes. They don’t. What’s your point.

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  3 people liked this. Like

SharksBreath 02/26/2011 06:02 PM in reply to blogbob

• Exactly. Better do it fast because once every one is in on the con they will change the rules.

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Ron 02/26/2011 01:07 PM in reply to lance peeples

• It should be noted that careful study of ExxonMobil’s tax reporting indicates they would have paid less overall in taxes had they paid some tax in the US. So they are LOSING MONEY to avoid paying taxes in the US. That’s not an economic decision. It’s a political one. And it should be ultra vires for a corporation to behave thus.

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pete 02/26/2011 01:09 PM in reply to Ron

• Exactly! The huge sum that various groups pay to avoid all kinds of regulation is probably greater than what they would “lose” to said regulation. They are like toddlers who pitch a fit whenever they hear the word “no”.

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mary lacewing 02/26/2011 02:23 PM in reply to Ron

• Who are they paying the higher taxes to?

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Ron Yesterday 03:53 AM in reply to mary lacewing

• Other countries. In their consolidated financials for 2009, they estimate the equivalent U.S. tax to the $15 billion they paid globally was about $12 billion. Had they paid ALL their taxes in the U.S., which was impossible, they would have saved $3 billion. That suggests had they not TRIED to avoid U.S. taxes, they would nave paid less overall.

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Ron Yesterday 08:31 AM in reply to MoodyEllis

• Because corporations exist to make money for their shareholders, not to lose money in furtherance of a political objective in a certain country.

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glogrrl 02/26/2011 06:42 PM in reply to Ron

• Not only do they not pay taxes in the US, they are recipients of the generous tax breaks the US gives ALL the oil companies. How can we get those bozos to stop doing that?

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justTheBleepingFacts 02/26/2011 02:13 PM in reply to lance peeples

• already exists. 
• unfortunately unlike for “main street”, corporate AMT has a minimum in name only. 
• the whole point of an AMT is that it’s the minimum so for working “people” once that number is met it’s what you pay. 
• even though corporations have an AMT it’s a meaningless law because tax credits apply to reduce the AMT so they can game the system.
• that’s what happens when corporate lobbyists write tax laws, american citizens are screwed over, and rich cronies benefit.

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MoodyEllis 02/26/2011 04:37 PM in reply to lance peeples

• This comment was flagged for review.

fractionofawhole 02/26/2011 05:17 PM in reply to MoodyEllis

• “progressivism”, “progressives”. Stop trying to make this a party line issue. If you think this is Republicans v. Democrats, Conservatives v. Progressives then you’re only contributing to the problem. Both parties are equally to blame. Wake up.

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Sean Laney Today 03:08 AM in reply to fractionofawhole

• Both parties *are* to blame, albeit not equally. On the other hand, if you are claiming the Democratic party is progressive, that is the silliest thing I have heard in a long time. They are a corporatist party just like the Republicans.

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Betsy Yesterday 01:16 AM in reply to lance peeples

• Yes, they are people, after all, and when you make HUGE profits you should pay HUGE taxes to the country that made it all possible. That’s the patriotic thing to do, right?

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Stephanie Fralin Yesterday 01:53 PM in reply to lance peeples

• Corporations only have to pay taxes on profits. The easiest way to avoid that is to give large bonuses to employees to make it appear that you made no profit for the year. If a company profits 12 million a year, they simply give their CEO, President and VP a nice fat bonus check for 4 million a piece. No profits showing, no taxes to pay. We all know these companies are profiting, they are simply using the corporate tax laws to their advantage. It’s one of the reason’s my husband started a corporation for his business instead of being a small business owner. If you can’t beat them, join em, right?

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the_proctor Yesterday 03:36 PM in reply to Stephanie Fralin

• So maybe we assess tax on income, ie sales or other sources of revenue, kind of like the rest of us persons have to?

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Sean Laney Today 03:11 AM in reply to the_proctor

• No, it would not work at all that way. Retail sales would be impossible unless markup was ridiculously high. You have to tax profits, not sales, but there are ways to make such things much more honest.

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the_proctor Today 03:21 AM in reply to Sean Laney

• Yes, I understand that. Interesting that individuals (non-corporate persons) don’t have the option of declaring what part of our income we want taxed. The various corporation structures allow companies to pass profits to individuals as bonuses that can be taxed at a lower rate or as regular income, leaving the corporation tax-neutral. 
• And then when you realize that people making millions are paying at individual rates of less than 20%, it’s a wonder the government has any money at all. 
• http://www.tax.com/taxcom/taxb…

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Sean Laney Today 03:09 AM in reply to Stephanie Fralin

• Most corporations *are* small businesses.

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the_proctor Today 03:23 AM in reply to Sean Laney

• She may have been comparing corporations with sole proprietorships that don’t incorporate.

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Fred666 02/26/2011 11:08 AM

• That’s odd, everyone thinks it was unions that caused the sub-prime crash.
• Ask anyone….really.

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Leftside_Annie 02/26/2011 01:44 PM in reply to Fred666

• No no no!!! It was ACORN!!!!

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blogbob 02/26/2011 02:50 PM in reply to Leftside_Annie

• SOROS! (drink!)

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mary lacewing 02/26/2011 03:20 PM in reply to blogbob

• Does it count if it’s not a troll saying that? lol
• Oh, who cares – what are you drinking?
• :)

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InsidiousProphet 02/26/2011 04:57 PM in reply to MoodyEllis

• Since 1968 we have had 5 Republican presidents and 3 Democratic presidents (Clinton was more of a republic or corporatist president)
• Nixon: 5 years
• Ford: 3 years 
• Carter: 4 years
• Reagan: 8 years
• Bush 41: 4 years
• Clinton: 8 years 
• Bush 43: 8 years
• Obama: 3 years
• So in the last 43 years we have had a Republican president for 28 years and a Democratic president for 15 years.
• By the way it was kind of neat how you totally ignore the Nixon, Reagan Ford and Bush 41 years. It is a fact that Reagan and Bush 41 both nearly tripled the national debt as they attacked the middle class and the American worker. 
• It is a fact that George W. Bush 8 years as president nearly destroyed our country as he ignorered the warnings of a coming terrorist attack, deregulated, ignored the housing crisis, cost the government $3.1 trillion in revenue while giving tax cuts to the wealthiest Americans during a time of war. Bush didn’t admit that we were in a recession until the final weeks of his presidency.
• So you can spin things all you want but facts are facts. 8 years of Bush along with a 6 year republican majority in both houses of congress under Bush led to the near collapse of our financial system and our economy as American jobs were shipped overseas in record numbers. (Edited by author 1 day ago)

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glogrrl 02/26/2011 06:45 PM in reply to InsidiousProphet

• Bravo, Prophet….you speak the truth. However, I’m sure it will have no effect on the Moooooody One because he is a conservative…and conservatives never let their minds be muddied by facts. They know what they believe, and you’re never gonna change their teeny little minds.

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My Editor Friend 02/26/2011 07:40 PM in reply to InsidiousProphet

• I take issue with your assertion that President Bush ignored the housing crisis. See news below.
• http://www.youtube.com/watch?v…
• http://www.youtube.com/watch?v…
• What do you think? (Edited by author 1 day ago)

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Sean Laney Today 03:18 AM in reply to My Editor Friend

• When Bush controlled the White House and his party controlled Congress, why didn’t they solve this looming crisis they claimed to be so concerned about?

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Leftside_Annie 02/26/2011 06:59 PM in reply to MoodyEllis

• God, you’re a dumbfuck. Really. You are just too stupid to live.

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Neoconhater 02/26/2011 11:15 AM

• One of the biggest lies from the right is the wealthy and corporations are the ones that pay the most in taxes of every kind.
• Greed is one of the strongest addictions known to mankind, hence the tax unfairness in America today. (Edited by author 1 day ago)

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mhandrh 02/26/2011 11:26 AM in reply to Neoconhater

• They continually and repeatedly make that claim and no one calls out their lies.

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Neoconhater 02/26/2011 11:36 AM in reply to mhandrh

• It is one of the canards that they’ve used to secure more tax cuts for the wealthy. The capital gains is 15 percent, it should be higher.  But the very fact some of the most profitable corporation pay nothing is more than disturbing, and do we hear any calls to end that disgusting fact from our so-called representatives? (Edited by author 1 day ago)

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Onyxcat 02/26/2011 01:25 PM in reply to Neoconhater

• No, we don’t. I blame our Congress. They are full of very wealthy people who don’t see what is happening, or refuse to see. Old Ted Kennedy may have been rich, but at least he understood the poor.

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DoDirty 02/26/2011 01:50 PM in reply to Onyxcat

• Duopoly, Both parties drink from the same Corporate well!

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glogrrl 02/26/2011 06:48 PM in reply to DoDirty

• To Moody: (no reply for your reply to DoDirty–it’s a stupid comment): There have been NO outbursts of violence in the 12 days of protest of union and ordinary people around the country. However, the Tea Party had violence all over the place last year, stomping on a woman’s head, threatening people with guns, etc. We’re all stocked up with crazy here, go somewhere else.

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Betsy Yesterday 01:21 AM in reply to Onyxcat

• Yup, they are rich, some very, very rich. I wonder why they would vote for their own self interest? Why, when none of their loyal followers do? Curious…

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Sean Laney Today 03:23 AM in reply to Neoconhater

• The capital gains tax is a privilege for the ultra rich, and rewards those who do not work for a living. Such profits should be taxed the same as any other income, not given special rate lower than that applied to the income of working people.
  •  

    EDITORS’ NOTE: The pretext here is that with their “surplus” cash from investment they’ll invest more…and create jobs, and all the rest of that con game that goes by trickle down/supply side economics. Voodoo is the right name, but neither the media nor the (bought) politicos will call it out for what it is, so the con continues…

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hopeforchangenow 02/26/2011 03:12 PM in reply to mhandrh

• Heaven forbid MSM might actually do some reporting. I am no longer donating to NPR due to their inept coverage of the WI rally.

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mapleleaflover 02/26/2011 12:22 PM in reply to Neoconhater

• We know them as corporate welfare bums.

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mhandrh 02/26/2011 01:26 PM in reply to mapleleaflover

• Yes, resurrect the old “welfare queen” and re-title it appropriately for the corporate welfare bums.

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Frozen Softserve 02/26/2011 11:20 AM

• Some of these facts were up on here a while back and it’s nice to see some organization around them. I don’t think it says much about our country that once a company gets big enough it doesn’t have to follow the same rules everything else does… which is even more ironic now thanks to Citizen’s United. If a company wants the rights of a person it better pay what a person pays.

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NortCoast 02/26/2011 11:22 AM in reply to Frozen Softserve

• And be fully liable with severe consequences for not paying taxes.

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blogbob 02/26/2011 02:53 PM in reply to NortCoast

• Cool! Let’s put the CEO, CFO, and COO of Bank of America and Exxon in prison, along with every member of their corporate boards. You’ll see the remainder of the Wall Street herd tripping over themselves to pay their taxes.