Verizon One of Most Aggressive US Corporate Tax Dodgers, Says US Consumer Advocate
Verizon’s possible entrance into the Canadian wireless market has triggered mixed reaction from all parties: the Big Three have launched an aggressive media campaign against the red US carrier and challenged Ottawa regarding its wireless policy. Canadian consumer advocates salute the rumour, and back Ottawa’s position.
But this isn’t the case with renowned US consumer advocate Ralph Nader, who has written a public letter to Prime Minister Stephen Harper calling the possibility of Verizon entering the Canadian market a “bad idea,” because the carrier is one of the most aggressive corporate tax dodgers in the US (via The Star).
In his letter, he points to a report by the highly regarded Center for Tax Justice and Good Jobs First entitled, “Unpaid Bills: How Verizon Shortchanges Government Through Tax Dodging and Subsidies”.
The report found that Verizon enjoyed some $14 billion in federal and state corporate income tax subsidies in the 2008-2010 period, even though it earned $33.4 billion in pre-tax U.S. income during that time.
At the federal level, Verizon should have paid about $11.4 billion at the statutory rate of 35 per cent during the three-year period.
Instead, it actually got $951 million in rebates, putting its federal tax subsidies at $12.3 billion.
Its effective federal tax rate was 2.9 per cent.
The report found that at the state level, Verizon should have paid about $2.3 billion in corporate income taxes during the period but it paid only $866 million.
He goes on to point to Verizon’s practices with which, he says, the carrier ripped off the US government: two years ago, the carrier paid $93.5 million to settle whistleblower charges that it had billed the government for tax-like surcharges it wasn’t entitled to impose.
From this perspective, Verizon doesn’t look good at all. He closes the letter by asking PM Harper if he would allow a wireless player with such a track record of ripping off the US government into Canada?