FedEx is among 26 companies that ended up paying no federal income tax the past three years, according to a report released Friday.
The report from the Washington, D.C.-based Institute on Taxation and Economic Policy said FedEx had an effective tax rate of minus-12.8% from 2018 to 2020, totaling a rebate of $877 million.
“FedEx achieved the same zero tax result on almost $6.9 billion of U.S. income during the past three years,” the Institute on Taxation and Economic Policy report said.
Other companies named in the report include Nike, Dish Network, Duke Energy and Salesforce.com. The institute’s findings came from an analysis it did on regulatory filings of publicly traded corporations such as FedEx.
“This continues a decades-long trend of corporate tax avoidance by the biggest U.S. corporations, and it appears to be the product of long-standing tax breaks preserved or expanded by the 2017 Tax Cuts and Jobs Act (TCJA) as well as the CARES Act tax breaks enacted in the spring of 2020,” the report said.
A provision in the CARES Act, an economic stimulus bill passed in the early stages of the COVID-19 pandemic, temporarily allowed companies to carry back 2018, 2019 or 2020 tax losses to offset prior-year profits. This resulted in a rebate that reduced taxes for companies that took advantage of the provision, the report said.
“The CARES Act, which was enacted in March 2020, helped companies like FedEx navigate a rapidly changing economy and marketplace while continuing to invest in capital, hire team members, and fund employee pension plans,” FedEx said in a statement Friday.
In a December regulatory filing, FedEx reported that its fiscal year 2021 tax rates included a benefit of $191 million from an increase in its 2020 tax loss. The CARES Act allowed losses to be carried back to 2015, when the federal income tax rate was higher, FedEx said in the filing.
“Taxing profits at one rate while allowing losses to produce savings at a higher rate is an invitation for companies to play games, moving profits and losses around from one year to another on paper to reduce their tax bills,” the Institute on Taxation and Economic Policy’s report said.
Max Garland covers FedEx, logistics and health care for The Commercial Appeal. Reach him at email@example.com or 901-529-2651 and on Twitter @MaxGarlandTypes.
This article originally appeared on Memphis Commercial Appeal: Report: FedEx paid $0 in federal taxes past 3 years; CARES Act, Trump tax cuts cited