Tuesday, January 31, 2006
In light of the media frenzy over the record 2005 earnings reported yesterday by Exxon Mobil and renewed calls for federal and state windfall profits taxes aimed at oil companies, the Tax Foundation this morning issued an interesting "Fiscal Fact" report, Large Oil Industry Tax Payments Undercut Case for "Windfall Profits" Tax:
It is important to remember that net income reported on financial statements, is the result of subtracting income-based taxes from corporate gross earnings. Before shareholders receive a return on their investment, the government takes its significant share off the top. During 2005, these three companies paid a combined corporate income tax burden of $44.3 billion on their reported gross earnings. Compared to last year’s combined corporate income taxes of $29.7 billion, their burden for 2005 has increased by 49.2% and follows the overall trend of escalating corporate tax collections in the United States. In addition to corporate income taxes, the same companies paid or remitted over $114.5 billion in other taxes in 2005, including franchise, payroll, property, severance and excise taxes.
Corporate Income Tax
Corporate Tax Rate
Corporate Tax Per Employee
Update: Wall Street Editorial here.