GE Tax Break and the SCM

March 29, 2011

From the NY Times:

General Electric, the nation’s largest corporation, had a very good year in 2010.

The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.

Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion.

There wasn’t enough in the article for me to figure out exactly what was going on here.  But if a company has $5 billion or so in profits, and pays nothing in taxes, how is that not a situation where “government revenue that is otherwise due is foregone or not collected”, under SCM Agreement Article 1.1(a)(1)(ii)?