Corporations already pay a ridiculously low tax rate on average, but under the Trump tax cut in 2017, more than twice as many corporations pay no taxes at all, or even get rebates. This includes some of the biggest companies in the nation, like Amazon, which actually got money back from the government on more than $10 billion in profit — not revenue, profit.
For decades, profitable companies have been able to avoid corporate taxes. But the list of those paying zero roughly doubled last year as a result of provisions in President Trump’s 2017 tax bill that expanded corporate tax breaks and reduced the tax rate on corporate income.
Corporations’ ability to whittle down their tax bills has long been a target of criticism by Democrats, and this presidential campaign is no exception, particularly among left-wing candidates who argue that corporations should be accountable for wage inequality and its impact on low- and middle-income workers…Several of the Democratic candidates have called for changes to the corporate system, and Ms. Warren has gone the furthest in issuing a detailed plan. Under her proposal, corporations would pay a new 7 percent tax on every dollar over $100 million in profits they earn anywhere in the world. She estimated the new tax would apply to roughly 1,200 companies and bring in $1 trillion.
Under Ms. Warren’s plan, Amazon would have paid $698 million instead of $0 in federal taxes for 2018. In a statement, the company said it “pays all the taxes we are required to pay in the U.S. and every country where we operate.”
And that’s the problem. They aren’t required to pay any taxes at all, and in fact our tax dollars are used to pay them tax rebates. In the 1950s, corporate taxes were nearly 1/3 of all federal revenue; today they are less than 10%. Total corporate tax revenue is projected to be $256 billion in 2020. Return to the 1950s corporate tax code and that number becomes nearly $900 billion, enough to erase most of the federal deficit. Our tax code is utter madness.