How Much Tax Does Big Oil Actually Pay?

It comes down to how you crunch the numbers
By Matt Cantor,  Newser User
Posted May 12, 2011 10:00 AM CDT
In this April 26, 2011 photo, a man pumps gas as a car whizzes by a Mobil Station in Stoneham, Mass.   (AP Photo/Elise Amendola)

(Newser) – If you ask Exxon Mobil, the firm will say last year’s taxes exceeded US income—but a Washington think tank will tell you the big oil company didn’t pay a cent the year before that. “It all depends on how you count,” writes Steven Mufson in the Washington Post. Exxon is throwing property, gas, payroll, and state taxes into the mix; the Center for American Progress is just counting federal corporate income taxes. From that angle, the firm’s tax rate last year was 17.2%, or “lower than the average American’s,” says an analyst for the group.

Specifically, Exxon holds that it paid “total taxes and duties to the US” of $9.8 billion, but its SEC filings show that it paid just $1.3 billion in federal income tax, compared to global income of $57 billion and US income of $7.7 billion. Exxon also says it earns only 9 cents per dollar of sales. “That’s about half (or less) of what companies in pharmaceuticals or computers make.” On the other hand, that’s not the figure the company refers to when dealing with investors; then, they discuss “return on capital employed,” which is a whopping 34%. (Read more Chevron stories.)

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