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- iHaveNet.com: Politics
by Joseph Rotella and Dennis Van Roekel
Families and small businesses pick up the tab for egregious tax loopholes exploited by corporations
Some politicians might believe that "corporations are people," as former Gov. Mitt Romney declared last year.
At tax time, however, corporations enjoy better treatment than ordinary folks. While millions of individual Americans file last-minute income tax returns this month, some major corporations won't pay a dime despite reaping record profits.
From 2008 to 2010, the 280 most profitable U.S. corporations sheltered half of their profits from taxes, thanks to tax subsidies totaling nearly
These subsidies didn't just come about by accident -- at least 30 Fortune 500 firms pay their lobbyists more than they pay in taxes. Most small businesses can't afford lobbyists, so it's no surprise that the benefits of tax loopholes flow mainly to Wall Street, not Main Street.
Thanks to these loopholes, probably no major company pays the full federal corporate tax rate of 35 percent. The highest three-year average effective rate paid by any of the 12 large corporations in the
That's the kind of sweetheart deal most taxpayers -- and most small businesses -- can only dream about. We do, however, get to pick up the tab for these costly tax breaks. For starters, when corporations shirk billions of dollars in federal taxes, middle class taxpayers must bear more of the cost of national defense, healthcare, and other necessary programs.
Then there is the effect on state and local services, most notably education.
Most states mirror federal tax loopholes, and many states also provide tax subsidies for companies just to locate within their borders. Total state and local tax subsidies to business add up to about
Small businesses also pay a price for corporate handouts. Not only is the tax burden shifted to companies that can't afford to game the system, but small businesses rely on public education to train skilled workers and teach them how to think critically. When
Our nation built the most prosperous economy in history during the 20th century, and public education was a foundation of that success. We all have a responsibility to provide similar opportunities for future generations to succeed, and our biggest corporations must do their fair share. After all, the same people who own stock in these companies also have a stake in America's future.
Joseph Rotella is founder and president of
AMERICAN POLITICS
WORLD | AFRICA | ASIA | EUROPE | LATIN AMERICA | MIDDLE EAST | UNITED STATES | ECONOMICS | EDUCATION | ENVIRONMENT | FOREIGN POLICY | POLITICS
How Everyone Else Pays for Big Business's Tax Breaks | Politics
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