Corporations Use Private Jets, Security Systems To Give CEOs Massive Tax Breaks
For the last four years, 26 major U.S. corporations have made billions in profits but paid nothing in federal income taxes. But corporations aren’t just dodging taxes on their own behalf, they’re helping their chief executives do it too.
Major corporations like Ford, Halliburton, Kraft, and others either require or recommend that their CEOs travel on private jets, for both business and personal travel, for “security reasons.” Some corporations also pay for home security systems, 24-hour surveillance, chauffeurs, and other perks, all in the name of safety. But as New York Times DealBook columnist Steven M. Davidoff notes, the CEOs aren’t really in imminent danger. Instead, paying for security and private travel “is a common corporate tax trick“:
It’s a different case for personal travel. In those cases, chief executives are required to pay income tax on the imputed portion of the flight — that is, the amount the company paid for the flight. So a chief executive who is a frequent flier can rack up a rather large tax bill.
Luckily, the tax code offers executives a break.
If an outside security consultant determines that executives need a private jet and other services for their safety, the Internal Revenue Service cuts corporate chieftains a break. In such cases, the chief executive will pay a reduced tax bill or sometimes no tax at all.Corporate taxes in the U.S. have fallen to a 40-year low, while the wealthiest Americans are paying historically low tax rates. And yet, both groups are finding new ways to pay even less in taxes, even if it means making actual taxpayers subsidize their travel and “security.”
No comments:
Post a Comment