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8 U. St. Thomas J.L. & Pub. Pol'y 222 (2013-2014)
General Electric's Tax Liability: The Case for Corporate Tax Reform

handle is hein.journals/tjlpp8 and id is 230 raw text is: GENERAL ELECTRIC'S TAX LIABILITY: THE CASE FOR CORPORATE TAX REFORM WILLIS L. KRUMHOLZ* I. INTRODUCTION America is in a state of fiscal crisis. For the last four years the United States Treasury has run unsustainable budget deficits. Much of this is due to wasteful spending, and entitlement programs that badly need reform. The other big driver of the debt and deficits is an inefficient, complicated, and bloated tax code. The current tax code hampers economic growth, the real solution to our national debt, and allows those with an army of accountants and lobbyists to manipulate and decrease their tax-liability. America's corporate tax is emblematic of this dysfunction. Since the mid 1950's, the corporate share of the nation's tax receipts has gone from 30 percent to 6.6 percent.' Although the U.S. (federal) corporate tax is set at 35 percent, the highest in the developed world when state taxes are tacked on, many of the largest American corporations fail to pay anything near this amount.2 Though reform occurred under Ronald Reagan and Tip O'Neill in 1986, with an attempt to broaden the tax base and lower the tax rates, much of the accomplishments of this reform have been eroded.3 Because of these concerns, policymakers in Washington have been discussing possible corporate tax reform, yet the actual willingness to act remains to be seen. Amid this climate, the New York Times published a piece in 2011 by David Kocieniewski that claimed General Electric (GE) paid no American taxes in 2010, and actually received a tax benefit of $3.2 * Willis L. Krumholz is a 2015 JD/MBA candidate. He is interested in investing, economics, financial regulation, and taxation. 1. David Kocieniewski, G.E. 's Strategies Let It Avoid Taxes Altogether, N.Y. TIMES, Mar. 24, 2011, at Al, available at http://www.nytimes.com/201 1/03/25/business/economy/25tax.html?pagewanted=all&_r-0. 2. Karen C. Burke, Is the Corporate Tax System Broken?, 28 VA. TAX REV. 341, 342 (2008) (discussing the decline of corporate tax revenues in the U.S. and different proposals to fix the tax code). 3. Id.

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