Patriotism 101: ExxonMobil schemes to avoid paying U.S. taxes
By Tom Maertens
Mankato Free Press
Universal Press Syndicate
MANKATO — There are some who mistakenly believe that ExxonMobil pays “a horrendous” amount of taxes to the United States. The facts reveal just the opposite.
ExxonMobil’s financial statements to the SEC show pre-tax profit of $35 billion and zero net income tax liability owed to the United States. Its spokesperson told Forbes that their tax payments are “not something we’re required to disclose, nor do we.”
Forbes said categorically that “None of ExxonMobil’s income taxes were paid in the U.S.”
In fact, the last GAO study found that 68 percent of U.S. corporations paid no U.S. taxes.
David Cay Johnston, Pulitzer-prize winning author of “Perfectly Legal”, explains their tax avoidance schemes. U.S. multi-nationals transfer their assets to shell corporations in offshore tax havens which they claim as their tax home(s), called corporate inversion. These overseas subsidiaries then license/lease these assets back to the U.S. parent company in return for extravagant payments, called transfer pricing.
That moves the profits from U.S. operations to overseas subsidiaries that get taxed at much lower rates, sometimes as low as 1 percent.
According to Forbes, such companies display “an uncanny ability to lose lots of money in the U.S ... and make lots of money overseas.”
The most egregious tax scammer was Enron, which used its 881 Caribbean subsidiaries to create an impenetrable web of accounting transfers that made U.S. profits disappear and foreign tax credits appear in their place.
ExxonMobil has 20 wholly-owned subsidiaries domiciled in The Bahamas, Bermuda and the Cayman Islands, for the sole purpose of making U.S. taxes disappear. The subsidiaries are shell corporations that “manufacture” nothing except tax losses. As Forbes writes, those countries are tax scams with a flag and an embassy.
Mankato Free Press
Universal Press Syndicate
MANKATO — There are some who mistakenly believe that ExxonMobil pays “a horrendous” amount of taxes to the United States. The facts reveal just the opposite.
ExxonMobil’s financial statements to the SEC show pre-tax profit of $35 billion and zero net income tax liability owed to the United States. Its spokesperson told Forbes that their tax payments are “not something we’re required to disclose, nor do we.”
Forbes said categorically that “None of ExxonMobil’s income taxes were paid in the U.S.”
In fact, the last GAO study found that 68 percent of U.S. corporations paid no U.S. taxes.
David Cay Johnston, Pulitzer-prize winning author of “Perfectly Legal”, explains their tax avoidance schemes. U.S. multi-nationals transfer their assets to shell corporations in offshore tax havens which they claim as their tax home(s), called corporate inversion. These overseas subsidiaries then license/lease these assets back to the U.S. parent company in return for extravagant payments, called transfer pricing.
That moves the profits from U.S. operations to overseas subsidiaries that get taxed at much lower rates, sometimes as low as 1 percent.
According to Forbes, such companies display “an uncanny ability to lose lots of money in the U.S ... and make lots of money overseas.”
The most egregious tax scammer was Enron, which used its 881 Caribbean subsidiaries to create an impenetrable web of accounting transfers that made U.S. profits disappear and foreign tax credits appear in their place.
ExxonMobil has 20 wholly-owned subsidiaries domiciled in The Bahamas, Bermuda and the Cayman Islands, for the sole purpose of making U.S. taxes disappear. The subsidiaries are shell corporations that “manufacture” nothing except tax losses. As Forbes writes, those countries are tax scams with a flag and an embassy.
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