Corporations are people, and according to William McBride of the Tax Foundation, those people receive less money from the entities they invest in than the federal government does.
This means that the federal government and not Wall Street is the biggest benefactor of so-called corporate “greed.”
Here’s McBride’s story (emphasis is mine):
While the corporate income tax code – like the personal income tax code – is complicated by too many credits and deductions that benefit a narrow set of taxpayers at the expense of the many, it is wrong to conclude that corporations in general pay little or no tax. Besides paying corporate income taxes to the U.S. federal government and foreign governments, corporations pay a litany of other taxes, including state and local corporate income taxes, sales, property, and payroll and social security taxes.
The graph below tells the story. It shows 15 years of IRS data, 1994 to 2008, on all corporate income tax returns. It indicates that on average, and in all but three of those years, total taxes paid by corporations exceeded after-tax profits.
After-tax profits peaked in 2006 at $780 billion, and then collapsed with the recession to $607 billion in 2008.
In blue are federal income taxes, which also peaked in 2006 at $315 billion and fell to $208 billion in 2008. That’s an effective tax rate of 26 percent of taxable income (pre-tax profits), averaged over 15 years (see this report for more).
In red are foreign taxes paid on the foreign income of U.S. corporations, which continued to climb through the recession, amounting to $98 billion in 2008. (This is an underestimate of foreign taxes paid, based on the foreign tax credit, as discussed in detail here.) Including these taxes on foreign income yields an effective rate of about 33 percent of taxable income, over 15 years.
Finally, in green are all other taxes* paid by corporations that are deducted as business expenses. This number peaked at $357 billion in 2007 and fell to $331 billion in 2008. Adding this to corporate income taxes, both domestic and foreign, brings the total taxes paid by U.S. corporations to $740 billion in the peak year of 2006, and $637 billion in 2008.
That means in 2008, as in most years, taxes paid exceeded after-tax profits, or in other words, government took a greater share than shareholders.
*Details on other taxes: This includes state and local corporate income taxes, property taxes, sales taxes, social security and payroll, unemployment insurance, excise taxes, import and tariff duties, business, license, and privilege taxes, and income and profit taxes paid to foreign countries or U.S. possessions unless claimed as a credit against income tax. This does not include state and local taxes paid in connection with an acquisition or disposition of property. Additionally, not all corporations include sales taxes.