Free Daily Headlines :

  • COVID-19
  • Money
  • Election 2020
  • Politics
  • Education
  • Health
  • Justice
  • More
    • Environment
    • Economic Development
    • Gaming
    • Investigations
    • Social Services
    • TRANSPORTATION
  • Opinion
    • CT Viewpoints
    • CT Artpoints
DONATE
Reflecting Connecticut’s Reality.
    COVID-19
    Money
    Election 2020
    Politics
    Education
    Health
    Justice
    More
    Environment
    Economic Development
    Gaming
    Investigations
    Social Services
    TRANSPORTATION
    Opinion
    CT Viewpoints
    CT Artpoints

LET�S GET SOCIAL

Show your love for great stories and out standing journalism

GE lobbies hard for tax loophole, groups say

  • Money
  • by Ana Radelat
  • April 4, 2014
  • View as "Clean Read" "Exit Clean Read"

Washington – How much is a tax loophole worth to a company?

A new report says that one in particular is so important to Fairfield-based General Electric that the company has deployed a small army of lobbyists to save it.

Congress will soon be deciding how many of the tax breaks that expired at the end of last year should be renewed; and according to a new report by two liberal-leaning advocacy groups, the impending debate has put in motion a tsunami of lobbying led by General Electric.

“Corporate Lobbying on Tax Extenders and the ‘GE Loophole,’”  a report by Americans for Tax Fairness and Public Campaign, says GE has deployed 48 lobbyists to urge Congress to renew a tax break called the Active Financing Exception, or AFE. The provision enables multinational corporations like GE to avoid paying federal income taxes on financial income that is generated offshore.

The groups say GE Financial is one of the biggest beneficiaries of this tax break now under consideration by Congress in a package of dozens. Collectively, these breaks are known as “extenders” because they are not a permanent part of the tax code and must be periodically renewed.

“An army of corporate lobbyists has converged on Congress to convince lawmakers to pass the ’GE Loophole’ and the entire tax extender package,” said Frank Clemente, executive director of Americans for Tax Fairness. “The general of this army is General Electric….”

The GE Loophole report says that, between 2008 and 2012, GE has claimed refunds from the U.S. Treasury totaling $3.1 billion, despite making $27.5 billion in profits. This information came from another liberal group, Citizens for Tax Justice, which determined GE’s tax liability from an analysis of the company’s annual reports. (GE’s tax filings to the Internal Revenue Service are protected from public inspection by privacy laws.)

5-year tax rates chart

Americans for Tax Fairness

Liberal groups want an end to the AFE because they think if corporations pay more taxes, citizens will receive greater and better services from their government.

GE Financial, which employs about 4,500 people in Connecticut, said the report “distorts the facts and reflects a politically motivated agenda from its authors.”

“The truth is that active financing applies the same rules to financial services that permanently apply to every other U.S. business sector,” said GE spokesman Seth Martin.

Martin also said, “the report is also wrong about GE tax payments.”

“We did not receive a net refund for any of the years cited, and in fact paid billions in tax payments to U.S. federal, state and local governments,” he said.

Harry Gural, co-author of the report, insisted that GE paid low tax rates for some years and received refunds for others. He also said GE’s dismissal of the report as politically motivated has no merit.

“When someone says you’re crazy or you’re stupid means you have run out of arguments,” Gural said.

There’s no question, however, that GE has lobbied heavily to include the AFE in a package of tax extenders under consideration by the Senate Finance Committee.

The GE Loophole report said GE hired 48 lobbyists to persuade lawmakers to renew the AFE, spending more than $61 million in lobbying fees on the issue.

A survey of Senate lobbying disclosure reports shows that GE has hired some of the most prestigious lobbying firms in Washington, including one established by former Sens. Trent Lott, R-Miss., and John Breaux, D-La., and that it has spent millions of dollars on in-house lobbyists to work on the AFE issue. But these influence peddlers worked on other issues, too.

Other financial companies, including Citigroup, Goldman Sachs, Morgan Stanley, Prudential and American Express, also lobbied lawmakers on the AFE.

The companies won the first round in this lobbying fight.

On Thursday, the Senate Finance Committee included the AFE in a tax extender bill that also contained dozens of other tax breaks for individuals and corporations. These include the money teachers spend out of their pockets for supplies for their classrooms, commuting expenses, mortgage interest premiums and tuition expenses. The Senate bill would also allow taxpayers to continue to deduct the money paid in state and local taxes on their federal tax forms. It also re-establishes – and expands for small businesses – a research and development tax credit that benefits many Connecticut companies.

But GE and other companies will continue to lobby to make sure the House of Representatives also renews their tax breaks. The House hopes to start work on a tax extender package next week.

The GE Loophole report said 1,359 lobbyists representing 373 corporations pressed Congress on tax extender legislation between January 2011 and September 2013.

Martin, the GE spokesman, said the long-term goal of his company and others is to end the temporary nature of these tax breaks.

“Lawmakers on both sides of the aisle and respected third-party experts agree that these rules should be a permanent feature of the tax code,” he said.

Sign up for CT Mirror's free daily news summary.

Free to Read. Not Free to Produce.

The Connecticut Mirror is a nonprofit newsroom. 90% of our revenue comes from people like you. If you value our reporting please consider making a donation. You'll enjoy reading CT Mirror even more knowing you helped make it happen.

YES, I'LL DONATE TODAY

ABOUT THE AUTHOR

Ana Radelat Ana has written about politics and policy in Washington, D.C.. for Gannett, Thompson Reuters and UPI. She was a special correspondent for the Miami Herald, and a regular contributor to The New York TImes, Advertising Age and several other publications. She has also worked in broadcast journalism, for CNN and several local NPR stations. She is a graduate of the University of Maryland School of Journalism.

SEE WHAT READERS SAID

RELATED STORIES
Connecticut’s $90M lobbying industry has a new player: former Speaker Joe Aresimowicz
by Mark Pazniokas

Former House Speaker Joe Aresimowicz is becoming a lobbyist, but a revolving-door law limits him for a year.

Spiking tax revenue will wipe out state budget deficit, analysts say
by Keith M. Phaneuf

Projected state revenues skyrocketed by $1.7 billion Friday, positioning officials to balance the next state budget without tax hikes.

Without vocal dissent, Senate confirms Justice Andrew McDonald
by Mark Pazniokas

The state Senate acted quickly Friday to confirm Andrew J. McDonald to a second term on the Supreme Court.

Funding to fix CT’s roads and bridges is drying up, and officials don’t have a solution
by Keith M. Phaneuf and Kasturi Pananjady

Connecticut's transportation building program is on a financial diet after a five-year ramp-up after lawmakers rejected tolls.

Once controversial, Justice Andrew McDonald backed for reappointment to CT’s high court
by Mark Pazniokas

Blocked as chief justice, Andrew J. McDonald is a shoo-in for another term as a Supreme Court justice.

Support Our Work

Show your love for great stories and outstanding journalism.

$
Select One
  • Monthly
  • Yearly
  • Once
Artpoint painter
CT ViewpointsCT Artpoints
Opinion Evidence not clear that Trump incited Capitol destruction
by Alan Calandro

Defending President Donald Trump is not popular and I have no interest in writing this other than adherence to truth. Recognizing the truth (if we can find it, which is not always possible of course) should make us be able to come together around that and move on with a common understanding.

Opinion Securing our nuclear legacy: An open letter to President-elect Joe Biden
by Erik Assadourian

Dear President-elect Biden: As you noted in a tweet shortly after protestors stormed the Capitol on Wednesday, “Today is a reminder, a painful one, that democracy is fragile.” Indeed it is. And so are nation-states.

Opinion Last votes of George Floyd, Breonna Taylor and others
by Gary A. Franks

Finally, the election season is over. The historic elections we saw in this cycle were intriguing. The runoff elections for the U.S. Senate in Georgia put a cap on the campaign season. For many people this could be described as a COVID-19 election. I would argue that this was an election influenced by a pandemic but determined by the killing of unarmed Black people with no adequate justice for the Black community.

Opinion Not just environmental problem; Killingly plant is a great target
by Joel Gordes

In 1990, I was one of five legislators to introduce the first climate change legislation that became PA 90-219, An Act Considering Climate Change, the most popular bill of that session. Back then I considered climate change a national security issue… and I still do.

Artwork Grand guidance
by Anne:Gogh

In a world of systemic oppression aimed towards those of darker skintones – representation matters. We are more than our equity elusive environments, more than numbers in a prison and much more than victims of societal dispositions. This piece depicts a melanated young man draped in a cape ascending high above multiple forms of oppression. […]

Artwork Shea
by Anthony Valentine

Shea is a story about race and social inequalities that plague America. It is a narrative that prompts the question, “Do you know what it’s like to wake up in new skin?”

Artwork The Declaration of Human Rights
by Andres Chaparro

Through my artwork I strive to create an example of ideas that reflect my desire to raise social consciousness, and cultural awareness. Jazz music is the catalyst to all my work, and plays a major influence in each piece of work.”

Artwork ‘A thing of beauty. Destroy it forever’
by Richard DiCarlo | Derby

During times like these it’s often fun to revisit something familiar and approach things with a different slant. I have been taking some Pop culture and Art masterpieces and applying the vintage 1960’s and 70’s classic figures (Fisher Price, little people) to the make an amusing pieces. Here is my homage to Fisher -Price, Yellow […]

Twitter Feed
A Twitter List by CTMirror

Engage

  • Reflections Tickets & Sponsorships
  • Events
  • Donate
  • Newsletter Sign-Up
  • Submit to Viewpoints
  • Submit to ArtPoints
  • Economic Indicator Dashboard
  • Speaking Engagements
  • Commenting Guidelines
  • Legal Notices
  • Contact Us

About

  • About CT Mirror
  • Announcements
  • Board
  • Staff
  • Sponsors and Funders
  • Donors
  • Friends of CT Mirror
  • History
  • Financial
  • Policies
  • Strategic Plan

Opportunity

  • Advertising and Sponsorship
  • Speaking Engagements
  • Use of Photography
  • Work for Us

Go Deeper

  • Steady Habits Podcast
  • Economic Indicator Dashboard
  • Five Things

The Connecticut News Project, Inc. 1049 Asylum Avenue, Hartford, CT 06105. Phone: 860-218-6380

© Copyright 2021, The Connecticut News Project. All Rights Reserved. Website by Web Publisher PRO