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Richard Blumenthal
Quick Hit
by Ellyn Fortino
12:51pm
Thu Jan 29, 2015

Study: Several U.S. Corporations 'Fleecing' Uncle Sam, Spending More On CEOs

A number of large U.S. corporations spent more on executive compensation than federal income taxes in 2013, according to a recent analysis by the Institute for Policy Studies and the Center for Effective Government.

Seven out of the 30 largest U.S. corporations examined for the "Fleecing Uncle Sam" report -- including Boeing Co., Ford Motor Co., Chevron Corporation, CitiGroup Inc., Verizon Communications, JPMorgan Chase & Co. and General Motors Co. -- spent $121 million on total compensation for their seven CEOs in 2013. On average, that's $17.3 million per CEO.

The seven firms reported over $74 billion in combined U.S. pre-tax income in 2013, but they collectively raked in nearly $1.9 billion in U.S. corporate income tax refunds that year. As such, the average effective tax rate in 2013 for the seven corporations was negative 2.5 percent, the analysis found.

"If the seven giant, highly-profitable corporations that paid their CEOs more than Uncle Sam had paid the full statutory corporate tax rate of 35 percent, they would've owed $25.9 billion in federal taxes," the report states. "Instead they received $1.9 billion in refunds, for a total difference of $27.8 billion."

Quick Hit
by Ellyn Fortino
1:05pm
Fri Sep 5, 2014

Report: Obamacare Curbed Taxpayer Subsidies For Health Insurer Executive Pay

The 2010 Affordable Care Act (ACA) sharply reduced taxpayer subsidies last year for executive pay at the nation's 10 largest publicly held health insurance companies, according to a new report by the Institute for Policy Studies (IPS), a Washington-D.C.-based think tank.

Last year, an ACA provision took effect that put a $500,000 cap on the tax deductibility of health insurer executive compensation. Previously, the companies had a $1 million limit on the deductibility of executive pay from federal corporate income taxes. Now, health insurance companies are allowed to deduct only up to $500,000 in combined performance-based and salary pay per employee each year.

As a result of the deductibility limits under the health reform legislation known as Obamacare, the country's top 10 health insurers saw their collective corporate taxes increase by an estimated $72 million in 2013, according to the report, "Executive Excess 2014: The Obamacare Prescription for Bloated CEO Pay."

Quick Hit
by Ellyn Fortino
5:21pm
Tue Jun 17, 2014

Report: Walmart Received $104 Million Taxpayer Subsidy For Executive Pay

recent report reveals that Walmart raked in taxpayer subsidies totaling $104 million for its executive pay over the past six years at the same time many of the retailer'slowest-paid workers have had to rely on public assistance to meet their basic needs.

Taxpayers subsidized the pay for top Walmart officials due to what critics say is a loophole that allows unlimited corporate tax write-offs on performance-based compensation for executives.

PI Original
by Ellyn Fortino
1:22pm
Fri May 2, 2014

Report Sheds Light On Taxpayer Subsidies For Restaurant CEO Pay

Some of the largest corporate members of the National Restaurant Association have pulled in hefty taxpayer subsidies for CEO pay at the same time the industry lobbying group has advocated against measures to increase the minimum wage for workers, a recent report from the Washington, D.C.-based Institute for Policy Studies shows. Progress Illinois takes a look at the report's findings.

Quick Hit
by Ellyn Fortino
10:42am
Fri Dec 20, 2013

New Report Sheds Light On Taxpayer Subsidies For Fast Food CEO Pay

recent report from the Institute for Policy Studies (IPS) reveals that fast food companies have been pulling in large taxpayer subsidies for CEO pay at the same time many of the firms' lowest-paid workers have had to rely on public assistance to help cover their basic needs.

Taxpayers have been subsidizing CEO pay for fast food companies and other firms due to a loophole that allows unlimited corporate tax write-offs on performance-based compensation for top executives.

From 2011 through 2012, CEOs of the top six publicly held fast food companies, including McDonald's, Yum! Brands, Wendy's, Burger King, Domino's and Dunkin' Brands, hauled in a collective $183 million in fully deductible performance pay, which comes out to be a total tax break valued at $64 million, according to the report.

PI Original
by Ellyn Fortino
6:29pm
Mon Oct 28, 2013

Peeling Back The Layers Of Doubt In The ACA's Glitch-Filled Start

The roll out of the Affordable Care Act met another snag Sunday after Terremark, the company that hosts the federal government's data hub and HealthCare.gov site, experienced a network failure. Progress Illinois takes a look at the recent debacle and the controversy that has surrounded the health reform law's glitch-filled start.

Quick Hit
by Ellyn Fortino
11:42am
Wed Aug 7, 2013

U.S. Senators Push To Limit Tax Subsidies For 'Performance-Based' CEO Pay

U.S. Sens. Jack Reed (D-RI) and Richard Blumenthal (D-CT) want to stop unlimited corporate tax write-offs on CEO performance-based pay, which leaves taxpayers holding a $5 billion tab each year.

The two senators introduced a bill Friday that would limit the tax deductibility of executive pay to $1 million and eliminate the exception for commission-based and performance-based compensation.

The bill, the Stop Subsidizing Multimillion Dollar Corporate Bonuses Act, S.1476, would expand the restrictions to all current and former employees of all corporations that file periodic reports with the U.S. Securities and Exchange Commission (SEC).

The Joint Committee on Taxation estimates the legislation will rein in $50 billion in tax revenue over a 10-year period, the senators said.

“Even as income inequality rises and middle-class wages stagnate, American taxpayers are subsidizing tens of billions of dollars in corporate bonuses,” Blumenthal said in a statement. “We should be investing in working families, not using taxpayer dollars for tax breaks to corporations that overpay their executives.  Corporations should be free to pay their executives whatever they wish, just not at the expense of American taxpayers -- many struggling to make ends meet.”