Guiding Questions for:
November 6, 2013
G.E.’s Strategies Let It Avoid Taxes Altogether
By DAVID KOCIENIEWSKI
1. What were company profits in 2010? Of this amount, what comes from its operations in the US
- GE reports profits of $14.2 billion, with $5.1 billion coming from U.S. operations.
2. Is this an MNC? Is GE a conglomerate? What does this mean?
- MNC stands for “Multinational Corporation and G.E. is a conglomerate who has many different industries. They are manufacturers of consumer appliances and medical equipment but are now profiting from their lending businesses overseas.
3. What is GE’s strategy regarding taxes? What do the lobbyists ...view middle of the document...
Their structure their work by devoting half the jobs to compliance and the other half to exploiting holes in the system. We see the revolving door situation with the bribing of government representatives to fight for GE’s tax breaks in return for money to be funneled into their districts.
7. How does GE justify its efforts to lobby for tax breaks? It is necessary for what? What does GE spend on lobbying?
- They argue that tax breaks allows for GE to be competitive with foreign organizations. If GE dominates, that would increase their market share and create more jobs. GE spent $18 million in inside lobbying and $4.1 million on outside lobbying.
8. What do the critics say about this aggressive policy to cut corporate taxes? Is this a form of corporate welfare? In the last 5 years, what were GE’s profits? What was its tax bill?
- Critics feel that GE’s assertive tax avoidance shortchanges the Treasury and our economy by discouraging investing and hiring in the U.S. GE racks up tax credits and subsidies from oversea operations and applies them to the higher tax rates they face in the U.S. In the last 5 years GE profited $26 billion and received a tax benefit for $4.1.