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Top CEOs Earn More Than Their Firms Pay in Taxes

Twenty five CEOs of America's top companies earned more money than their companies paid in taxes last year, according to the Institute for Policy Studies' Executive Excess report. The think tank "researched the 100 U.S. corporations that shelled out the most last year in CEO compensation. At 25 of these corporate giants," the Institute "found the bill for chief executive compensation actually ran higher than the company's entire federal corporate income tax bill."

Companies on the list include Verizon (VZ), International Paper (IP), Prudential Financial (PRU), GE (GE), BNY Mellon (BK), Boeing (BA), Marsh & McLennan (MMC), Stanley Black & Decker (SWK), Chesapeake Energy (CHK), and Ebay (EBAY). (See the gallery below for the report's full list of compensation and refund details.)

The report also challenged the gap between CEO pay and those of the average workers at the companies they run. "The gap between CEO and average U.S. worker pay rose from 263-to-1 in 2009 to 325-to-1 last year."

The report was particularly hard on companies that use tax-avoidance techniques such as money held "off shore" to "accelerate depreciation." GE has already been criticized in the press, particularly by The New York Times, for the level of taxes it has paid in recent years.

The Institute for Policy Studies report says that Congress must take action to close the tax loopholes that allow companies to pay low taxes in comparison to their earnings and even listed potential government remedies to corporate tax dodging. They include: closing "numerous loopholes that facilitate tax dodging through abuse of tax havens" and mandating "that corporations take the same deduction for stock-based executive compensation on their tax returns as they do in shareholder financial reports." Legislation has already been introduced in Congress on both matters.

The Institute also said that laws which give shareholders little voice in corporate governance shield CEOs from questions about pay packages. But because the companies are public, one of the most important opinions should be those of the shareholders. GE shares, for example have underperformed the S&P 500 during the last year. But, shares in eBay and Verizon have done better by the same measure. The stockholders of the firms that did outperform the market may not care about what the companies in which they own shares paid to Uncle Sam.

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This brings up a good point and reminds me of an old debate about the sum of the parts versus the final product. Say these companies get rid of their CEOs, or the CEOs leave on their own. What happens to the company? Are the CEOs actually irreplaceable? I found this list of "irreplaceable CEOs" at http://www.ranker.com/list/the-most-irreplaceable-ceos-in-the-world/ready-to-startup but I'm not sure that list is complete. What could they add there to make it complete or is the theory that no one person is ever irreplaceable to a company a complete farce? I'm torn.

September 11 2011 at 12:32 PM Report abuse rate up rate down Reply

As an ex-CEO of a "charity", of course we make more than our corporate profits. Then 'graduating' to becoming a government (Australia) appointee to the Accreditation Board, I could see that we charity bosses had fringe benefits far beyond any outsiders' wildest imaginations. To appease our conscientious: those in the profit sectors had several times our income, on paper, but with fewer responsibilities, fewer troubles, less public scrutiny, more social honor and less insecurity than our peers.

Retiree, Australian Capital Territory

September 02 2011 at 10:19 PM Report abuse rate up rate down Reply

I would read the damned story if it wasn't spread out in 25 different click-galleries. If there is anything to the story, why don't you put it on here in a way that somebody who doesn't have all morning to read one story can read it? What crap!

September 01 2011 at 12:25 PM Report abuse +1 rate up rate down Reply

There's nothing like a class warfare diatribe, pitting one American against another, to coax the bigots out from under their rocks

September 01 2011 at 12:14 PM Report abuse rate up rate down Reply
1 reply to warrenbent's comment

you got to "jews for gun ownership" -- and determined that the comment was anti Jew?

READ THE POST - If any of the players are Jewish... it's a coincidence. My diatribe is NOT anti Jewish... but anti THEFT

September 01 2011 at 12:43 PM Report abuse rate up rate down Reply
2 replies to gustafus's comment

I read many countless posts villifying "the rich" by those who despise fellow Americans by virtue of the size of other bank accounts.

founded on the principle that in the eyes of the government, we are all merely free and equal Americans. The bigots instead insist on categorizing us based on particularistic triats we may share with fellow citizens. Whether those triats are skin color or gender or sexual oritentation or any of a whole host of other traits including wealth, these are still the very definition of bigots.

September 01 2011 at 12:53 PM Report abuse rate up rate down

Perhaps what happened was that you read my post which in no way referred to yourself or any of the content in your post, and assumed it muct be about you merely because it included the word "bigot"?

September 01 2011 at 2:08 PM Report abuse rate up rate down
Johnson Smith

This is quite a true fact but we cant say anything in this as this is the matter of the company

September 01 2011 at 9:14 AM Report abuse rate up rate down Reply

Even though corporations have posted record breaking profits it has not translated into jobs as the GOP keeps saying to protect their protegees. To the contrary, workers compensation has dropped.
The simplifying the tax code ideas that the right has proposed will INCREASE taxes on ALL BUT the coprorations. Thethree tier tax percentage raises taxes for teh bottom two tiers and cuts them for the top tier.
So no, no jobs from increased corporate profitability, if so they would have hired and they have not.
Corporations are created to make a profit, not for the well being of the unemployed.

September 01 2011 at 8:44 AM Report abuse rate up rate down Reply
1 reply to itala2's comment

GE is happy ! And I believe their CEO is Jeffery Immelt,Obama's job creator guy. From what I read about GE so far since 2010, Jeffery Immelt has expanded business in more foreign countries than here in the US. I also believe Immelt is a registered Democrat. So while you blame the GOP both affiliates benefit from the tax breaks. Our government loves to spend our money as long as we let them do it. Smart voters in 2012 will vote these spendthrift incumbents out of office along with their lobbying friends.

September 01 2011 at 9:29 AM Report abuse rate up rate down Reply

The fact of the matter is that none of these firms, or any other for that matter, should have to pay any income tax. The income tax is a big failure and should be recinded in the Constitution. It is a tax on the people. Those who believe that Corporation Tax is a tax on corporations are misleading themselves. That expense is simply passed down to the consumer in the form of increased prices on the goods and services that are produced by the corporations. The income tax should be replaced by a national sales tax of about 5% and that has an absolute cap of 10%, and the Federal Government should be forced to live within its means. If this, or something similar can't be done and the Federal Government continues to bankrupt everyone in the country, then it is probably time for the states to call a Constitutional Convention and just get rid of this Government and replace it, including all of the Congress and the Supreme Court and the President, with new people, and the Constitution should be tweeked in order to institute term limits for all the Congress, the President, and all Federal Judges, but the Bill of Rights should not be touched. The government should be forced to live within its means and no activity outside the Constitution should be allowed.

September 01 2011 at 8:32 AM Report abuse rate up rate down Reply

No Person or Company is required to pay more in Tax than the Law requires of them.
- Judge Learned Hand

CEOS are actually doing a pretty good Job for a change !

September 01 2011 at 8:18 AM Report abuse rate up rate down Reply

I just read a bunch of comments that don't seem to address the article. Greed is the root of the problem,and all the political parties are culpable. A verifable fact is Obama polices ( 2009 - 2011 ) cost 1.4 trillion dollars and bush policies ( 2001 - 2008 ) cost 7 trillion dollars. It appears that the republicans and tea partiers support continuing and expanding current policies ( bush's ) that favor corporate Amercia. This is working fine for them, but not so well for the country and the rest of us. there are a lot of us out here fed up with the status quo, and are capable of researching for the truth. To me the answer is NOT to allow the minions of corporate power continue to control the country. Vote republicians out and don't let tea partiers in !
If anyone really reads these, please don't take my word or Anyone elses word for anything ! Search for the truth, research for yourself, they will use all manner of untruths to misdirect your attention.

September 01 2011 at 7:07 AM Report abuse rate up rate down Reply
2 replies to ccurt78's comment

I wouldn't be putting the blame all on the Repub's and tea baggers, the Democraps are pretty dogone greedy as well. May I direct your attention to the millions in kick backs that the past head of Fannie Mae (and a house in Ireland) under the watchfull eye of Barney Frank and Sen. Kanjorwski. Yes, I am fed up, I am fed up and frustrated for myself and now for my 20 year old daughter. HOw many of US out there have children who have degrees and are working at jobs that no degree is required for? There is something wrong and it needs to be addressed by the people. Politicians are a waste !!!

September 01 2011 at 8:13 AM Report abuse +1 rate up rate down Reply

ccurt, congratulations on emerging from your long coma. Now you need to set about the tedious task of getting up to date on the events of the last 2 1/2 years since falling into your lethargic state.

The first place to start is with "current policies". They are ones facilitated by our current POTUS, Barrack Obama.

Good look on a speedy recovery!

September 01 2011 at 12:24 PM Report abuse rate up rate down Reply

AGAIN and AGAIN... FLAT TAXES for every American, Poor Meddle Class and Reach will be the solution.
We will not be here talking about Taxes for the reach and the poor again.

September 01 2011 at 1:49 AM Report abuse +1 rate up rate down Reply
1 reply to Moreira's comment

Yes, but it will translate in a atx increase for the lowest tiers and the middle class.

September 01 2011 at 9:00 AM Report abuse rate up rate down Reply