Walmart, the world’s wealthiest corporation, has avoided an estimated $104 million in U.S. taxes by granting extravagant “performance pay” bonuses to top executives, according to a new report by Americans for Tax Fairness and the Institute for Policy Studies.
The company utilizes a loophole that allows companies such as Walmart to deduct an unlimited amount from income taxes to compensate executives through stock options and other so-called “performance pay.” As Frank Clemente, executive director at Americans for Tax Fairness, explained in Alternet:
“With this tax loophole, the bigger the executive bonuses the less Walmart pays in taxes. This is truly one of the most perverse loopholes of all time.”
Among its many findings, the report claims that by compensating former CEO Mike Duke nearly $116 million in performance pay, Walmart essentially received a taxpayer subsidy totaling over $40 million from 2009 to 2014. In the past six years, the company reduced their taxes by over $104 million using this loophole.
Today’s report follows shortly after yesterday’s news that the Walton family, owners of Walmart, have contributed very little personal wealth to their family charity and instead have used the charity’s tax structure to avoid an estimated $3 billion in estate taxes.
The company pays the majority of its hourly workforce so little that they must rely on government assistance such as food stamps and Medicaid, yet the company continues to avoid paying taxes that help fund those very programs its employees are forced to use. In other words, everyday Americans are footing the bill for Walmart’s poverty-level wages… and its executives’ padded bank accounts.
Meanwhile, the company’s hourly employees have had enough. Today, in cities around the country, members of OUR Walmart are going on strike to protest the company’s retaliation against employees that speak out for change. Previously, employees that have spoken out against low wages and inadequate hours risked being disciplined and even outright fired. In response to the alleged retaliation, the National Labor Relations Board issued a complaint against the company earlier this year and is investigating potential violations of labor law, including illegally firing workers for going on strike.
Let’s be clear on what’s happening here. Even though the company can easily afford it, Walmart refuses to pay its workers decent wages. So it relies on taxpayers to make up the difference by funding government assistance programs for its employees. The company and its controlling family then avoid paying their fair share in taxes on the order of billions of dollars each year. And if employees complain, speak out, or go on strike, Walmart intimidates, disciplines or outright fires them.
It’s time for change at Walmart.
Read the entire report, “Walmart’s Executive Bonuses Cost Taxpayers Millions.”