This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

General Electric Wants to Pay More Taxes

NEW YORK ( TheStreet) -- General Electric (GE - Get Report) says it advocates closing all tax loopholes, an event that would almost certainly result in the company paying more taxes, according to a pair of tax experts.

General Electric has a reputation as one of the most effective U.S. companies at minimizing its tax bill. The company's tax strategies attracted widespread attention in March, when they became the subject of a front page story in The New York Times that, among other highlights, pointed out that GE paid no federal taxes in 2010 despite earning $14.2 billion, including $5.1 billion in the U.S. In fact, the story notes, GE got a tax benefit of $3.2 billion last year.

That now-notorious GE tax return is back in the news thanks to Rep. Paul Ryan, who told attendees at a recent townhall meeting that, if printed out, it would total some 57,000 pages.

Ryan called attention to the size of the return to underscore the need for corporate tax reform, as a bipartisan 12-member Congressional "super-committee" charged with addressing the deficit nears a deadline next week. If they fail to reach a deal before the deadline, a series of drastic cuts are set to kick in.

Asked about Ryan's comments, a General Electric spokesman sent a statement to TheStreet that read: "We agree with Congressman Ryan that the U.S. tax system needs to be reformed and all loopholes should be closed. Furthermore, Congress needs to lower the corporate rate and provide the US a territorial system like every other major country in the world."

Under a territorial system, U.S. companies operating abroad would only be taxed on foreign profits in the countries where those profits were booked. Currently, U.S. companies also pay U.S. taxes on foreign profits, though they receive credits on taxes they paid to other governments.

Rebecca Wilkins, senior counsel with the nonprofit Citizens for Tax Justice, regarded GE's statement with suspicion.

"You've got to wonder why GE would want the system to be changed. I mean how much more negative would they like their rate to go? They are hugely benefitting from the current system," she says.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
GE $26.80 0.00%
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs