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FAIRFIELD COUNTY, Conn. Lost amid the recent Occupy Wall Street protest outside the New Canaan home of General Electric CEO Jeff Immelt were the clashing facts distributed by protestors and GE about whether the Fairfield-based company did or did not pay corporate taxes in 2010.
Also overlooked were some of the contradictory statements Immelt has made in recent months. He has said publicly that he believes corporate taxes should be cut further and that taxes on American holdings outside the United States cut entirely, but he also has come out in "support" of the Occupy Wall Street movement.
The growing movement's main theme is that the wealthy particularly multibillion-dollar corporations should to be taxed more, and the poor and middle class taxed less.
Thus, the movement's catchy chant "We are the 99 percent" was created, alluding to the Americans who average about $54,000 per household per year, compared with the top 1 percent, who average more than $1.5 million annually.
A debate over whether GE paid its fair share of taxes has been raging since Immelt was named by President Barack Obama last March as his "jobs czar," taking over as chairman of the president's Jobs and Competitiveness Task Force. Some critics denounced the appointment, citing GE's elimination of 19,000 jobs since 2008, while Immelt was getting a hefty raise to more than $21.4 million.
The company reported worldwide profits of $14.2 billion last year, indicating $5.1 billion of the total came from its operations in the United States, according to the New York Times and Washington Post. Yet, its American tax bill was zero. In fact, according to the Times and Post, GE claimed a tax benefit of $3.2 billion.
How did GE do it? Using an "aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. GE's giant tax department, led by former Treasury official John Samuels, and often referred to as the world's best tax law firm," according to the Washington Post.
It's why Occupy Wall Street protestors chose Immelt as its first target in Fairfield County. About 100 protestors, including a busload of about 30 from the movement in New York, rallied outside Immelt's $5.4 million gated mansion last Saturday.
"We are the 99 percent, we are the 99 percent!" the protesters shouted, led by June Benjamin, of the UAW in Stamford and a member of the Connecticut Working Families Party, which organized the rally. She urged on the crowd, aided by a bullhorn.
But GE disputed allegations made by its critics and the protestors.
"The protesters certainly have a right to share their opinion, but they don't have a right to their own set of facts. The fact is that GE is investing in America. Since 2009 alone, GE has announced more than 10,000 new U.S. manufacturing jobs and this week, GE announced that it will build its 16th new factory in the U.S. since 2009," said Andrew Williams, director of media relations for GE.
"GE did pay federal income tax last year and we also paid over $1 billion in other federal, state and local taxes," said Williams.
But according to the Times and Post, tax loopholes and "creative accounting" made it possible for the corporate giant to pay no actual taxes in 2010. "Like any American we do like to keep our tax rate low," he told the Times, adding that GE follows all the rules. "Business rarely speaks with one voice on anything, but we do on taxes," Immelt said.
It's comments such as those that outrage Occupy Wall Street protesters.
"It's time that corporate titans like Jeff Immelt knew how tough it is for those of us without multi-million dollar bonuses," said Jon Green, executive director of Connecticut Working Families. "Jeff Immelt needs to understand how eliminating thousands of jobs and not paying taxes is hurting ordinary Americans."
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