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Amy Mall’s Blog

ExxonMobil had a lower effective tax rate than the typical middle-class family

Amy Mall

Posted September 28, 2011 in Health and the Environment, Moving Beyond Oil

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The Center for American Progress (CAP) just released a very important report about the finances of big oil and gas companies. Among the findings:

Five oil and gas companies—Chevron, ConocoPhillips, ExxonMobil, BP and Shell— are sitting on cash resources of $59 billion, which is 30 times more than the estimated $2 billion in annual tax breaks that these companies receive.

In other words, there is no justification for the industry's claim that they cannot afford to have their special tax giveaways taken away from them.

CAP also shoots a big hole in industry's claim that the tax breaks create jobs. It turns out these companies lay off workers even when they get the tax break. According to CAP, despite generating $546 billion in profits between 2005 and 2010, ExxonMobil, Chevron, Shell, and BP combined reduced their U.S. workforce by 11,200 employees over that time. Just in 2010 alone, the big 5 oil companies reduced their global workforce by a combined 4,400 employees, while making a combined $73 billion in profits.

And CAP reports that ExxonMobil’s effective tax rate was 18 percent while average households pay 21 percent.

The oil and gas industry does not need the special tax giveaways, especially in today's economic climate, and Congress should not hesitate to eliminate them.  

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Comments

Michael GaleSep 28 2011 02:17 PM

As a small business owner, this makes me ill, not new info, but still very ill. But there is hope: http://www.huffingtonpost.com/jay-coen-gilbert/benefit-corporation-legislation-_b_976650.html

WCGasetteSep 28 2011 02:22 PM

That meme that they need these tax breaks to create jobs...it all feeds into that notion that these corporate Big Boys will take good care of of us if we just don't "penalize" them ~ as if paying their fair share of the taxes is some kind of penalty that will hurt us.

Of course, if we dare question this notion then they just throw out the "socialist" label. They bully us with language ...we really do need to recognize that for what it is and call "Foul! One more Infraction and you're out of the Game."

Mark McLeroySep 30 2011 12:07 AM

Your assertion that the average household pays a 21 percent tax rate is just blatantly false. You may have meant to say "the average households that PAYS taxes is 21 percent." The fact of the matter is that 51 percent of all households in the US pay no taxes and have an effective tax rate of 0 percent. I'm more concerned and indignant about the folks who don't pay their share at all than I am about those who are perceived about not paying enough. And yes, my household is one of the 49 percent who pay that 21 percent effective tax rate.

ConfusedSep 30 2011 12:27 AM

So, Mark McLeroy... You're saying we should RAISE taxes? Republicans can't have it both ways. So which is it? Lower taxes... or higher taxes? Half the country doesn't pay taxes because they are poor. The tax credits they get (from GW Bush) zero out their liability. But when big oil companies pay less than people like yourself, don't you see a problem with that?

RandallSep 30 2011 12:36 AM

Mark, aren't you MAD that you pay higher taxes than billion dollar corporations (that aren't even generating jobs)??? This isn't a political issue. It's just common sense, man.

M McLeroySep 30 2011 11:36 AM

This will be my last comment on this forum because it allows people like CONFUSED to ignore the rules of the forum discussion and still have their comments stay posted (no name, reference to Republicans, rederence to GW Bush, etc). But in parting, I will leave you with an important fact that so many of you either don't know or choose to ignor: Companies and Corporations don't pay their taxes....THEIR CUSTOMERS PAY THEM! Product costs, business expenses and taxes are always passed along to the customer in the form of the prices we pay for their products. I suggest that a National Flat tax rate on all income/revenue, with no deductions or allowances, would go a long way to eliminating the problems addressed in the above blog as well as insuring that all of our citizens contribute a fair share for the privilege of living in this great Country.

KathrynSep 30 2011 02:42 PM

M McLeroy, As a nonprofit, we are required to remove any statement endorsing or opposing any candidate for political office. But people are free to comment on current or former politicians and political parties as long as their statements aren't related to elections. Thanks for sharing your thoughts.

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Switchboard is the staff blog of the Natural Resources Defense Council, the nation’s most effective environmental group. For more about our work, including in-depth policy documents, action alerts and ways you can contribute, visit NRDC.org.

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