• Walmart at the Trough: Billions Scammed from Your Tax Money

    August 6, 2014

    Tags: , , ,
    Posted in: Economy, Minimum Wage




    Walmart, which already is profiting mightily from federal, taxpayer paid corporate welfare in the form of food stamps subsidizing its workers’ low wages, as well as billions in direct profits from buyers shopping with food stamps, also takes advantage of tax laws that help it avoid paying federal tax.

    Thanks for Shopping at Walmart, Suckers

    American taxpayers subsidize much of the cost of Walmart’s executive pay. Walmart (and other large companies) uses a loophole in a tax law created by Congress in 1993 (Section 162(m) of the tax code) that allows it to deduct unlimited amounts from corporate income taxes. All Walmart has to do is deduct the cost of executive compensation if it is paid in the form of stock options and other so-called “performance pay” instead of straight salaries. Congress wrote the law to apply only to actual salaries.

    A new report by Americans for Tax Fairness shows:

    Ka-Ching! $104 MILLION: Walmart reduced its federal tax bills by an estimated $104 million over the past six years by paying its top eight executives $298 million in “performance pay” that was fully tax deductible. The tax revenues lost would have been enough to cover the cost of free school lunches for 33,000 children for those six years.

    Ka-Ching! $40 MILLION: Michael Duke, Walmart’s recently retired President & CEO and currently Chairman of the Executive Committee of the Board of Directors, pocketed nearly $116 million in exercised stock options and other “performance pay” during the period 2009-2014. That translates into a taxpayer subsidy for Walmart of more than $40 million— enough to cover the average cost of food stamps for 4,200 people for those six years. FYI: Duke’s total compensation for 2013 was $27.6 million, all wrung out of those everyday low prices.

    Ka-Ching! $50 BILLION: Taxpayers would save $50 billion over 10 years, according to the Joint Committee on Taxation, if Congress changed this tax law, even if the new law allowed a generous tax deduction of one million dollars for each employee’s total compensation, with no exceptions for performance pay, as originally intended when the law was first created in 1993.

    Ka-Ching! $14 BILLION: And about those tax-payer funded food stamps. Overall, 18 percent of all food benefits money is spent at Wal-Mart. That’s about $14 billion.

    Ka-Ching! $7.8 BILLION: Taxpayers spend $7.8 billion a year subsidizing Walmart through public assistance to the company’s low paid employees.

    Ka-Ching! $3 BILLION: The four members of the Walton family, who control almost all of Walmart, shelter signficant amounts of their money from taxes by placing the cash into trusts, allowed by the tax code. To avoid taxes on the dividends generated out of these trusts, those monies are donated to the Walton Family Foundation, a registered charity. When the trusts expire upon the deaths of the elder Waltons, however, their underlying assets, along with any income earned above the amount required to go to the Foundation, will revert to the trusts’ non-charitable beneficiaries, the second or third tier Walmart heirs-in-waiting. The non-charitable beneficiaries of the trusts will likely receive these trust assets entirely free of estate taxes. Cost to taxpayers is estimated at $3 billion in lost tax revenues.


    What it Means

    There are some important takeaways, besides the obvious. The first concerns the minimum wage. It is clear that Walmart could easily pare off a sliver of the billions its owners take in to raise wages without raising prices. They just don’t want to. Even if prices went up, savings in food stamps that would not have to be paid to starving workers would be substantial.

    The other thing to consider is the conservative argument that business growth is critical to broader economic and societal growth. Maybe in some ways, but as shown with Walmart, certainly it does not lead to larger tax revenues; quite the opposite. Somebody has to pay for all those food stamps and trust fund loopholes. That’s you.

    It is important to remember that companies have been enjoying these taxpayer subsidies for their executive compensation since 1993, plus the economic benefits of food stamps to subsidize their profits and low wages. That they exist today, at the phenomenal costs to regular Americans noted above, is no secret.

    So draw your own conclusions from that as to how Congress views all this corporate welfare.




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    Copyright © 2020. All rights reserved. The views expressed here are solely those of the author(s) in their private capacity.

  • Recent Comments

    • jo6pac said...

      1

      I’m sure the 1% will soon fix the problem of Main Street having to little $$$$$. We on Main Street will have no $$$$.

      http://www.theguardian.com/commentisfree/2014/aug/05/neoliberalism-mental-health-rich-poverty-economy

      08/6/14 4:33 PM | Comment Link

    • Rich Bauer said...

      2

      This is a great platform for you to run for prez, Peter. Last night The Daily Show gave its support for the Van Buren name.

      http://thedailyshow.cc.com/videos/aiw431/brand-name-politics

      08/6/14 8:21 PM | Comment Link

    • pitchfork said...

      3

      quote”Walmart, which already is profiting mightily from federal, taxpayer paid corporate welfare in the form of food stamps subsidizing its workers’ low wages, as well as billions in direct profits from buyers shopping with food stamps,..”

      Yeah, well if Congress cuts the SNAP program any more, there won’t BE anyone spending them there.

      Let me give you some facts. And please excuse my rant.
      Me and my wife get food stamps..aka..the SNAP program. Yesterday, as usual, we HAVE to do our shopping as soon as we get them, because we are almost OUT OF FOOD..by the time we get our next allotment which is.. a whopping $169 PER MONTH..for two people. Which breaks down to $21.12 each per week. Try to eat for a week on that. Shades of TopRaman…daily. Meat? Ha.
      As an aside, I remember my dad told me, his family, to survive in the 30’s, literally ate cornbread and beans, maybe some hotcakes, 7 days a week for SIX YEARS. Once a month or so, they’d get a little pork. Now I know how they felt.

      So guess where we have to shop? You got it. Fucking Walmart. As much as I detest these cocksuckers, we have to save every possible cent. Last year I stopped shopping there when I lived in Oregon. But now..there is simply no other alternative where I live. Even then, I have to drive 30 miles to get there.

      Now, I didn’t post this to bitch about that so much. What I AM bitching about is this motherfucking corporation getting MILLIONS in tax breaks, while millions of seniors are literally scraping the bottom of the food chain barrel.
      In fact, I’m so pissed off, I just fired off another email to that fucking scumbag Senator of mine..Debbie Stabenow, who was instrumental in the bill to cut SNAP by 40 BILLION FUCKING DOLLARS. I hope you don’t mind Peter, but I linked this post to my email. I also emailed AARP with the link as well, suggesting to them that maybe it’s about time for a million seniors to PROTEST ENMASS outside the Senate.
      This much is clear. While these Congressional sonsabitchs have created laws to subsidize corporations like Walmart, while their scumbag exec’s make millions of dollars a year, while seniors in this country struggle every single day..THIS IS CRIMINAL. Plain, old corruption.

      Notwithstanding subsidizing every goddamned other criminal country..LIKE ISRAEL(those motherfucking war criminals)with BILLIONS and BILLIONS of hard working taxpayers dollars, not to mention weapons..and then..continuous wars, the outrageous budgets for NSA, CIA, DOD, DHS, FBI, ATF, DEA, and every other criminal agency in the USG.. well. I have a feeling something is gonna give here pretty quick. OR ELSE.

      All I know is Piketty was dead on and the Ghosts of Tom Joad are getting fucking pissed.

      And please, if I could, I would still be working to earn my way. But you know as well as I do..there ain’t no fucking jobs for people 70 yrs old. The fact is..I EVEN APPLIED FOR A JOB AT …gak..Walmart. Lord help me. I must be going crazy. On the other hand..fuck Walmart.

      ok..rant over. Carry on.(insert rolling eye smiley here)

      08/7/14 12:29 PM | Comment Link

    • Rich Bauer said...

      4

      Pitch,

      You’re preaching to the choir.

      Peter Van Buren – 2016

      08/7/14 12:37 PM | Comment Link

    • pitchfork said...

      5

      YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN! YES WE VAN!

      INTEGRITY! LEADERSHIP! AND NO MORE WALMARTS!..YES WE VAN! 2016!

      I have the perfect platform for ya too..

      The Ghosts of Tom Joad= a billion votes.

      umm, about that big whale oil though…

      meanwhile..
      “Pitch,

      You’re preaching to the choir.”

      I know. I know. But I said pretty much the same thing to Senator Scumbag. This was just a draft.

      🙂

      08/7/14 12:54 PM | Comment Link

    • pitchfork said...

      6

      Peter.. don’t laugh. I think YOU would make a GREAT President. At least at the end..you wouldn’t have to say…

      WE MEANT WELL. Like the last 10 have.

      08/7/14 1:00 PM | Comment Link

    • wemeantwell said...

      7

      …and give up showbiz? I am content to work behind the scenes as Hillary’s bikini waxer.

      08/7/14 1:51 PM | Comment Link

    • pitchfork said...

      8

      “I am content to work behind the scenes as Hillary’s bikini waxer.”

      BAHAHAHAHAHAHAHAHAHAHAHA!

      Meanwhile at Foggybottom…Kerry welcomes a despot..

      http://thecable.foreignpolicy.com/posts/2014/08/06/white_house_under_fire_for_welcoming_south_sudan_leader_as_famine_nears?utm_source=Sailthru&utm_medium=email&utm_term=*Situation%20Report&utm_campaign=SITREP%20AUG%207%202014

      This fucker is absolutely shameless..

      I guess some people at State are cringing though. After all…Kerry can’t hide it anymore.

      08/7/14 3:06 PM | Comment Link

    • Rich Bauer said...

      9

      “I am content to work behind the scenes as Hillary’s bikini waxer.”

      And you passed State’s psych eval?

      08/7/14 3:56 PM | Comment Link

    • wemeantwell said...

      10

      Yes, passed. The diplomats who fail the psych test just go back to their regular jobs.

      08/7/14 3:58 PM | Comment Link

    • Rich Bauer said...

      11

      Well, you are a BRAVE man. You have gone where NO MAN has gone for a very long time.

      08/7/14 4:18 PM | Comment Link

    • pitchfork said...

      12

      So Peter, tell me more about this here “bikini waxing” thingy. Never heard of that job description notwithstanding having to take a psych evaluation. Although, after working for not one, but two different crazy mofo’s on the Oregon coast, I should have had one before taking the second job. After that one..I swore off working. Hahahahaha!

      08/7/14 5:30 PM | Comment Link

    • wemeantwell said...

      13

      Read my friend: http://www.amazon.com/Confessions-Brazilian-Bikini-Waxer-Reny/dp/1439206775

      In Hillary’s case, though, the job does require full HAZMAT gear.

      08/7/14 6:30 PM | Comment Link

    • Rich Bauer said...

      14

      Bush v Bush?

      08/7/14 7:29 PM | Comment Link

    • jo6pac said...

      15

      08/7/14 7:39 PM | Comment Link

    • Rich Bauer said...

      16

      There is something worse than being Clinton’s Bushmaster: Chris Christie’s Proctologist

      08/7/14 7:44 PM | Comment Link

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