Washington, D.C.–(ENEWSPF)–May 12, 2011. Yesterday the Center for American Progress released the column “Exxon Mobil Dodges the Tax Man: Exxon Pays a Lower Effective Tax Rate than the Average American,” with an accompanying spreadsheet that includes the data on Exxon’s effective tax rate from 2008 to 2010 as the Fortune 500 annual ranking puts the company at the top of the nation’s most profitable firms for the eighth time in a row.
The oil giant’s average effective tax rates are roughly half the 35 percent tax rate that currently stands as the high-water mark for American corporations. Meanwhile, Exxon Mobil and other Big Oil companies continue to exploit tax loopholes for nearly $4 billion in subsidies each year. These subsidies include write-offs for drilling costs and a deduction for domestic production that was intended for manufacturers, not Big Oil producers.
More striking still is the discrepancy between Exxon Mobil’s rates and those of most American breadwinners. Despite their billions in profits and billions in taxpayer subsidies, Exxon Mobil paid approximately the same effective tax rate as Americans in the fourth income quintile—which includes Americans earning from $62,000 to $100,000 a year. The company’s effective rate of 17.6 percent is nearly 16 percent below the average individual federal tax rate, which according to the Congressional Budget Office was 20.4 percent as of 2007.
Exxon Mobil’s accounting methods mask its relatively low effective tax rate. According to CNN Money, the $3.1 billion in taxes the company claims to have paid since January 2011 includes both federal and state gasoline taxes—that are really paid by drivers—as well as employee payroll taxes.
To read the full column, click here.
To download data on Exxon Mobil’s effective tax rate from 2008 to 2010, click here.
Source: americanprogress.org
