The stock market boomed last year, despite a pandemic that put 45 million Americans people out of work. But dozens of the biggest, most profitable corporations in the United States still paid $0 in federal taxes, according to a new report.
The nonpartisan Institute on Taxation and Economic Policy found that 55 of the largest firms in the country used a complex roadmap of tax breaks and loopholes to bring their tax bill down to zero, despite turning millions, or even billions in profit. Such relief came from a combination of policies preserved or expanded by President Donald Trump’s 2017 Tax Cuts and Jobs Act, as well as reprieves offered by the CARES Act. The companies reported a collective $40.5 billion in pretax income last year, which would typically mean that—at the corporate tax rate of 21%—they would owe $8.5 billion to the government; however, they managed not just to negate that total, but also to wrangle $3.5 billion in tax rebates.
In doing so, ITEP says, the companies were engaging in a “decades-long” tradition of tax avoidance by the biggest U.S. businesses, dating back to the Reagan era. Those on the list include Nike, which reaped $2.8 billion in 2020; Dish Network, which earned $2.5 billion; Fedex, which earned $1.2 billion; and chipmaker Advanced Micro Devices, which earned $1.2 billion. The report comes as the Biden administration is campaigning to raise taxes on corporate profits to 28%, after the rate was reduced from 35% to 21% by the Tax Cuts and Jobs Act.