The two companies with the lowest tax rates were both oil companies. ExxonMobil paid $1.5 billion in taxes on $73.3 billion in earnings, a tax rate of 2 percent. Chevron’s tax rate was just 4 percent. None of the companies paid anywhere near the 35 percent top corporate tax rate, providing more evidence to debunk claims that America’s corporate tax rate is stunting economic growth and job creation (Despite the high marginal rate, American corporations pay one of the lowest effective corporate tax rates in the world).
The study also calculated the overall amount the companies owed in both domestic and foreign taxes. This includes deferred taxes that will, theoretically, be paid in the future, once the companies bring foreign profits back to the United States. Apple, for instance, avoided $2.4 billion in American taxes last year by utilizing offshore tax havens.
If Republicans have their way, however, those deferred taxes may never be paid. Switching to a territorial tax system, a policy leading Republicans have considered, would allow corporations to repatriate foreign profits back to the United States nearly free of taxation, costing the country billions of dollars and thousands of jobs.