U.S. corporations get breaks on tax

Many of the largest U.S. companies paid corporate income taxes at an effective rate far below the 35 percent in the tax code, a report released Thursday said. Two liberal groups, Citizens for Tax Justice and the Institute on Taxation and Economic Policy, looked at the records of 280 companies that made money each year between 2008 and 2010, CNN reported. They found the companies paid an average of about 18.5 percent in corporate taxes. While 71 companies paid more than 30 percent, others paid no corporate income tax at all -- and 30 had tax liability in negative territory thanks to what the report's authors called "excess tax breaks." Those included utility Pepco Holdings Inc. with total income of $882 million over the three years and General Electric Co. with income of $10.5 billion. Tax breaks, many of them geared to specific industries and even specific companies, have crept back into the tax code since a housecleaning during President Ronald Reagan's administration, the report said. "GE paid billions of dollars in taxes in the United States over the last decade, and we expect our overall tax rate will be approximately 30 percent in 2011," the company said in a statement. "We believe the U.S. tax system needs to be reformed to close all loopholes, to lower the corporate rate and to provide a territorial system like every other major country in the world."