Oil Companies Pay 11.7 Percent Tax

August 5, 2014 Taxation in USA

WASHINGTON D.C. – US oil and gas companies face an effective tax rate of less than half of the standard rate for corporate income tax in the country.

Over the 4 years between 2009 and 2013 the largest 20 oil and gas companies in the USA paid an effective corporate tax rate of 11.7 percent, according to information in a new report released late last week by the US based think tank Taxpayers for Common Sense.

Over the four years, the 20 largest companies reported a total pre-tax income of approximately USD 133.3 billion, and reported an income tax liability of USD 32.1 billion, an effective rate of 24 percent.

However, after taking into account all available tax deferrals, incentives, and benefit programs, the oil and gas producers paid a total of USD 15.6 billion, an effective rate of 11.7 percent, far lower than the standard corporate tax rate of 35 percent.

The experts of Taxpayers for Common Sense also pointed out that some companies paid even lower tax rates, with ExxonMobil and Chevron reducing their tax rate to 3.7 percent, while Pioneer Natural Resources even managed to obtain a USD 6 billion tax refund.

Photo By: Nestor Galina