Washington D.C. is observing Emancipation Day today, commemorating the historic bill President Lincoln signed into law in 1862 ending slavery in the nation's capital. The Internal Revenue Service is observing the holiday, meaning taxpayers will have until April 18 this year to file their returns. Businesses too. And significant chunks of corporate America will get a pretty sweet deal when it comes time to turn in their returns, if recent history continues. Take Chicago-based Boeing as an example.
Shortly after the president's State of the Union speech, New York Times economics columnist David Leonhardt published an illuminating piece about corporate tax rates, reporting that over the past five years, Boeing paid a total tax rate of just 4.5 percent (the company said it contributed more money to its pension fund and received research credits, lowering its rate). In all, Leonhardt reported that 115 out of the 500 large firms listed on the Standard & Poor's index owed a total tax rate of less than 20 percent -- substantially lower than the 35 percent federal rate for corporations. And 39 of those firms paid less than 10 percent.
Some firms -- like General Electric -- owed nothing in federal corporate taxes in 2010, despite racking up over $14.2 billion in profits, more than a third of which were generated in the U.S. Obama said in his State of the Union speech that the loophole-riddled system must change, but Leonhardt concluded in Feburary that that wouldn't be easy. "[A]ny system that creates as many winners as this one won’t be changed easily," he wrote. Progressives and labor activists will seek to push the issue forward on April 18 at "Make Them Pay" events targeting millionaires and large corporations across the country.