US companies paid $91B less in taxes under Trump’s new law
American companies paid $91 billion less in taxes last year, thanks to the massive tax cuts signed into law by President Trump in 2017, according to recent data published by the Internal Revenue Service.
According to the data, companies paid close to $262.7 billion in taxes in 2018, the first year the full tax law was in effect. That’s compared to $338.5 billion in 2017 and about $345.5 billion in 2016.
The news was first reported by Yahoo Finance.
Companies were some of the biggest beneficiaries of the 2017 Tax Cuts and Jobs Act, which slashed the corporate tax rate to 21 percent from 35 percent while still keeping intact most of the tax breaks that allow profitable companies to zero out what they owe
Not only did companies pay less in taxes last year, however, they also received bigger refunds from the IRS. In 2018, businesses in the U.S. received a whopping $60.1 billion, bringing the net tax collection by the IRS to $202.6 billion. Comparatively, companies received about $44.8 billion in federal refunds in 2017, meaning the IRS took a net collection of $293.7 billion.
According to the Joint Committee on Taxation, the new tax law is set to save U.S. corporations $1.4 trillion by 2027.
Sen. Elizabeth Warren, a 2020 Democratic hopeful and Massachusetts Democrat, slammed the news in a tweet on Monday evening.
“How are giant corporations getting away with this?” she wrote. “Because the #GOPTaxScam lowered their effective tax rate to the lowest it’s been since 1947. My Real Corporate Profits Tax would make sure the biggest and most profitable corporations pay their fair share.”
Plus, in 2018, 60 of America’s biggest companies paid $0 in federal taxes, despite earning billions of dollars in profits. That includes Amazon, Netflix, General Motors, Chevron, JetBlue, IBM and U.S. Steel, which all used a diverse array of loopholes and tax breaks, according to a report from the INstitute on Taxation and Economic Policy, a nonpartisan think-tank.
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“The result, unsurprisingly, has been a continued decline in our already-low corporate tax revenues: in fiscal 2018, U.S. corporate tax revenues fell by 31 percent, according to U.S. Treasury data,” the study said. “This was a more precipitous decline than in any year of normal economic growth in U.S. history.”