Congress has reported that between 1998 and 2005, two-thirds of U.S. corporations paid no federal income tax. According to a study by study by the Government Accountability Office (GAO), roughly 68 percent of foreign companies doing business in the U.S. paid no corporate taxes.
The GAO said some companies may avoid paying such taxes due to operating losses or because of tax credits. Some have blamed the abuse of transfer prices, which are amounts charged on transactions between companies in a group, such as a parent and subsidiary. Some multinational companies can manipulate transfer prices to shift income from higher to lower tax jurisdictions, thereby reducing tax liability. The GAO did not study why corporations weren’t paying federal income taxes or corporate taxes and corporations weren’t individually identified.
Source: http://www.breakinglegalnews.com/category/Tax?TSSESSION=78683186664a3262702336837667ede3
