WASHINGTON -- Pepco is not only the most hated company in America. According to a new report, the D.C.-area electric utility is also one of the "Dirty Thirty" -- one of 30 Fortune 500 corporations that pay less in federal income taxes than they spend on federal lobbying.
The report, put out by the U.S. Public Interest Research Group and Citizens for Tax Justice, finds that Pepco Holdings -- the only D.C.-headquartered company on the list -- has an effective federal tax rate of negative 57.6 percent. (Companies with negative tax balances are getting more in refunds, rebates and credits than they pay in a year.)
The power company, fined $1 million by the Maryland Public Service Commission in December for its unreliable service, paid $3.8 million in lobbying expenses while paying negative $508 million in taxes, according to the report.
The report contains some policy recommendations that are a little tenuously connected to the information about how much companies spend on lobbying versus how much they spend (or don't spend) on taxes. Among the recommendations are that offshore tax "loopholes" be closed and that any company's political spending be disclosed and/or approved by shareholders.
Most Occupy-friendly of all is the recommendation that Citizens United v. Federal Election Commission, decided two years ago this week, be overturned.
Citizens for Tax Justice put out another report about Pepco's negative tax rate last November. Pepco's response to that report was that the company paid all the taxes it owed and that its tax rate relates to legitimate policy objectives designed "to encourage economic investment and create jobs."
Pepco's lobbying disclosures, published on Opensecrets.org, show that Pepco lobbied on one tax issue in 2011: the Withholding Tax Relief Act of 2011, which would have ended the requirement that government entities withhold 3 percent of payments due to vendors. That bill was filibustered in October.
Flickr photo by Daquella manera, used under a Creative Commons license.
Correction: This article previously indicated that Citizens United v. FEC was decided Jan. 18, 2010. It was decided Jan. 21, 2010.
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