A report was released by the Institute for Policy Studies after a survey they conducted on various top corporations in the U.
S.
revealed that some of these companies had their top CEOs earning more many than the company's corporate taxes! The survey that was conducted in mid 2011 was aimed at checking how CEOs earned in comparison with other expenditures in these corporations.
From these surveys, various issues were raised about the running of different leading corporations in the United States.
Difference between CEO's Income and Income of Other Staff The survey report revealed that many of these CEOs earned much more than other staff members in the organization.
According to the report, the compensation of the CEOs of these corporations outmatched that of the regular U.
S.
income-earner by 325-to-1; this ratio was significantly higher in comparison to the 2009 numbers of 263-to-1.
Cases of Tax Avoidance According to the report, many of these leading corporations use all sorts of loopholes in the tax code to pay as little tax as possible.
The corporations use such loopholes as accelerated depreciation to reduce the amount of taxes to be paid.
Offshore Incomes According to the report, many of the international corporations that were part of the survey kept much of their profits in foreign accounts to avoid paying any taxes.
This, they say, denied the government taxes that should otherwise, have been paid.
The tax code allows corporations with international subsidiaries to keep their profits in foreign accounts untaxed.
The corporate taxes for the profits made abroad by these corporations are only applied once the funds are repatriated into the country.
Congress Called to Action In their report recommendation, the institute suggested that Congress work towards sealing the various loopholes available in the tax code which allow these corporations to avoid paying taxes.
They also suggested that shareholders of these companies, most of which are public, be given more voice in the decisions of the company.
This way, the Institute felt that there would be more monitoring of these companies and the CEOs would not receive the exaggerated pay.
Critics to the Report However, following the recommendations made by the Institute, critics downplayed this comparison between CEOs' incomes and the corporate tax or the compensation to other workers.
Many argue that as long as the company remains profitable to the extent that the shareholders are pleased, then the CEO is entitled to his or her hefty paycheck.
They argue that some of the companies in the survey actually outperformed the market and shareholders did not care that Uncle Sam was denied cash - as long as their share price kept rising.
They further argued that the incentives in the tax code are there to be taken advantage of and if a company optimized on the opportunities in the tax code to legally avoid paying excessive taxes, then the companies and CEOs should not be punished or portrayed in bad light.
S.
revealed that some of these companies had their top CEOs earning more many than the company's corporate taxes! The survey that was conducted in mid 2011 was aimed at checking how CEOs earned in comparison with other expenditures in these corporations.
From these surveys, various issues were raised about the running of different leading corporations in the United States.
Difference between CEO's Income and Income of Other Staff The survey report revealed that many of these CEOs earned much more than other staff members in the organization.
According to the report, the compensation of the CEOs of these corporations outmatched that of the regular U.
S.
income-earner by 325-to-1; this ratio was significantly higher in comparison to the 2009 numbers of 263-to-1.
Cases of Tax Avoidance According to the report, many of these leading corporations use all sorts of loopholes in the tax code to pay as little tax as possible.
The corporations use such loopholes as accelerated depreciation to reduce the amount of taxes to be paid.
Offshore Incomes According to the report, many of the international corporations that were part of the survey kept much of their profits in foreign accounts to avoid paying any taxes.
This, they say, denied the government taxes that should otherwise, have been paid.
The tax code allows corporations with international subsidiaries to keep their profits in foreign accounts untaxed.
The corporate taxes for the profits made abroad by these corporations are only applied once the funds are repatriated into the country.
Congress Called to Action In their report recommendation, the institute suggested that Congress work towards sealing the various loopholes available in the tax code which allow these corporations to avoid paying taxes.
They also suggested that shareholders of these companies, most of which are public, be given more voice in the decisions of the company.
This way, the Institute felt that there would be more monitoring of these companies and the CEOs would not receive the exaggerated pay.
Critics to the Report However, following the recommendations made by the Institute, critics downplayed this comparison between CEOs' incomes and the corporate tax or the compensation to other workers.
Many argue that as long as the company remains profitable to the extent that the shareholders are pleased, then the CEO is entitled to his or her hefty paycheck.
They argue that some of the companies in the survey actually outperformed the market and shareholders did not care that Uncle Sam was denied cash - as long as their share price kept rising.
They further argued that the incentives in the tax code are there to be taken advantage of and if a company optimized on the opportunities in the tax code to legally avoid paying excessive taxes, then the companies and CEOs should not be punished or portrayed in bad light.