GE's Tax Loopholes, Take Two: How It Really Works

A new report from ProPublica and Fortune adjudicates in the GE-New York Times spat

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The New York Times' scathing report from a few weeks ago about how GE avoids paying taxes ended up becoming a bit of a controversy on its own, as GE contested the account. The company disputed, in particular, the Times' declaration that GE had not paid any American taxes in 2010, despite earning over $14.2 billion worldwide.

An article written Allan Sloan of Fortune and Jeff Gerth of ProPublica, published in two fairly different versions on each publication's website today, sets the record straight, coming to many of the same conclusions as David Kocienieski's Times account. Felix Salmon sums up the ProPublica/Fortune report's effects on the controversy succinctly: "The NYT got the truth right, but the facts wrong." The new report corroborates that the amount of taxes paid by General Electric are far below the 35 percent tax rate in the United States, but suggests that the amount being paid for 2010 is not quite zero. It's worth noting that Kocienieski's account had originally noted that G.E. had reported a "tax burden" that amounted to 7.4 percent of its American profits--around a third of the average of other multinational American companies. Have a look at the chart, above.

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