10 U.S. Companies Paying the Lowest (and Highest) Corporate Taxes
Arguing about taxes is as American as apple pie. You may feel that the rich pay too little, or that everyone pays way too much. We can argue about how residents of certain parts of the United States are paying taxes without Congressional representation. Politicians famously publish their tax plans which are derided and ridiculed by those on the other side every election year.
And another part of that argument is corporate tax rates — or, how much money in taxes our businesses fork over to local and federal governments. Some say that if we were to lower the corporate tax rate, we’d spur the economy by attracting more businesses and making them cheaper to operate. Others say businesses should pay more to offset externalities like pollution. It’s a fight that will likely never be settled.
But if you’re wondering which of America’s biggest companies are getting off relatively easy with their tax bills, Wallethub’s Corporate Tax Rate Report is the place to look.
Wallethub’s work “provides an in-depth analysis of the 2015 rates at which S&P 100 companies — collectively worth more than $12.4 trillion as of Sept. 30 (2016) — are taxed at the state, federal and international levels.”
The report said that the overall tax rate among the S&P 100 is around 28%, which presents no change from the prior year. Among the 100 companies, only one expected a negative tax rate — which you’ll see on the following pages. Corporate taxes are a complicated topic that isn’t easy to understand with just a cursory read. It’s recommended that you look through the entire report and do some other reading into the subject as well.
But if you want to know which companies are paying the most, and which are paying the least in corporate taxes? We’ll cut to the chase.
These are the American companies that are paying the most and least in corporate taxes, per Wallethub’s Corporate Tax Rate Report.
10. Merck: 17.4%
We’ll kick off with the 10 companies paying the lowest overall corporate taxes. That includes taxation at the state and federal levels, as well as levied by other countries. Pharmaceutical company Merck landed at the No. 10 spot, paying an overall 17.4%
9. Google: 16.8%
Perhaps Google’s leadership team Googled, “How to lower your tax burden?” The company pays some of the lowest taxes among the S&P 100, with an effective combined rate of 16.8%.
8. Gilead Sciences: 16.4%
A research and biopharmaceuticals company, Gilead Sciences paid 16.4% corporate taxes in 2015.
7. IBM: 16.2%
An old powerhouse, International Business Machines (IBM) also pays a relatively low corporate tax rate. In 2015, IBM paid 16.2%.
6. Lilly Eli & Co.: 13.7%
Another big pharmaceutical company, Lilly Eli & Company forked over 13.7% in corporate taxes in 2015.
5. Amgen: 13%
Biotech and therapeutics company Amgen is also the beneficiary of a relatively low tax rate. In 2015, the company paid 13%.
4. 21st Century Fox: 12.6%
21st Century Fox is a mass media conglomerate. It has a ton of subsidiaries that will be familiar to most people — Fox News, FX, Fox, 20th Century Fox, etc. In terms of taxes, though, the company paid 12.6% in 2015.
3. Mondelez International: 7.5%
Mondelez International is a giant food and beverage company, headquartered in Illinois. It also pays a pretty low tax rate — 7.5% in 2015.
2. Chevron: 2.7%
You’d think that a company like Chevron would pay a lot in taxes, considering the externalities associated with fossil fuels. But it’s not the case. In 2015, Chevron paid only 2.7% in corporate taxes.
1. General Motors: -34.3%
The one company with a negative effective tax rate in 2015 was American automaker General Motors. Yes, that means the company should actually get money back from the government. You may think that’s good, or you may think it’s a downright shame — either way, GM should get a hefty refund check.
As that exhausts the list of companies paying the lowest corporate taxes, the following pages will run down the 10 paying the most.
10. Comcast: 37.1%
Among the S&P 100 companies paying the highest tax rates, Comcast lands in the 10th spot. If you hate them, you’ll be glad to hear the company forked over 37.1% in 2015.
9. Union Pacific: 37.7%
Union Pacific — yes, the railroad company — pays quite a bit in taxes. In 2015, the company’s tax bill topped 37.7%.
8. CVS: 39.3%
Pharmacy chain CVS also pays quite a bit in taxes. In 2015, it paid an effective 39.3%.
7. Facebook: 40.5%
While Google gets away with a relatively low tax bill, Facebook is on the other end of the spectrum. Facebook paid 40.5% in 2015.
6. Lowe’s: 42.4%
Home improvement chain Lowe’s also pays a fairly high corporate tax rate. In 2015, Lowe’s paid 42.4%.
5. UnitedHealthcare: 42.6%
UnitedHealth Group, a provider of health insurance and other things, paid 42.6% in 2015.
4. Colgate-Palmolive: 44%
We don’t think too much about toothpaste companies and taxes. But Colgate-Palmolive is in the top four paying the most in corporate taxes. In 2015, it paid 44%.
3. Amazon: 60.6%
What does Amazon do with all of that money we send it? According to Wallethub, it pays a lot of it back in taxes. In 2015, Amazon paid 60.6%.
2. Kinder Morgan: 73.1%
A company that owns and operates pipelines for natural gas and petroleum, Kinder Morgan has the distinction of being the second-largest corporate contributor in terms of taxes. In 2015, the company paid a rate of 73.1%.
1. General Electric: 79.2%
While General Motors is paying -34.3%, General Electric will pony up 79.2% in corporate taxes in 2015. This is the highest tax bill among the S&P 100.
See Wallethub’s complete report here.