According to the US Census Bureau, one in two Americans is either poor or in the “low income category” and at the same time one the biggest American corporations pays no income taxes at all. American corporate watchdog Citizens for Tax Justice discovered that Facebook Inc. found a way to use a tax exemption scheme in order to pay zero dollars in income taxes. The whole situation should be outrageous as it is but the situation is actually worse, because Facebook’s tax optimization consultants have found a way to make the government pay Facebook.
Judging by the figures mentioned in Facebook’s 10K report, the corporation will receive 429 million dollars from the government for the fiscal year 2012. The government is also set to dish out an additional amount of 5.8 billion dollars because of “NOL tax loss carry forwards created by stock compensation”.
The American corporate tax code has a number of loopholes that are used extensively by the US corporations to make the government pay them instead of paying the government. For instance, in Facebook’s case, the loophole used by the corporate tax dodgers is the obligation of the government to compensate losses for stock options distributed to employees and executives. It is clearly a “double win” situation for the corporate bosses. The more their stock options and stock compensation increases in value, the more money the government will pay to the corporations they manage and own. If we exclude the corporation from the scheme, as it is merely a transit point for the flow of money, we have a direct transfer of wealth from the government to the managers of the biggest US corporations. One of the most widespread myths of the today’s world has been busted. It is not the poor people who live on governmental welfare; it is the corporate bosses who are the main beneficiaries of the government’s welfare systems. Of course, no congressman or senator dares to admit this, because that would result in the loss of their hard-earned money coming from the corporate lobbyists.