USA. P&G is the biggest local payer of corporate taxes, according to a national study conducted by American City Business JournalsThese are Cincinnati’s biggest corporate taxpayers Steve Watkins 18 October 2017 Business Courier of Cincinnati Take a quick look at the list of Greater Cincinnati public companies that pay the most in corporate taxes and you probably won’t be surprised, but the difference in tax rates is a lot more eye-opening. Consumer products giant Procter & Gamble Co. (NYSE: PG) is the biggest local payer of corporate taxes, according to a national study conducted by Courier parent company American City Business Journals of how much big corporations across the country pay in taxes. It’s also by far the largest local company in market capitalization. P&G paid $3.3 billion in income taxes in fiscal 2016. That’s the 20th-biggest corporate tax bill in the country, ACBJ’s study found. Not coincidentally, P&G generated $13.4 billion in pretax income last year. It easily generated the most profits of any local company. Apple Inc. paid the most in corporate income taxes in the nation last year, footing a $15.7 billion bill. Huge banks Wells Fargo & Co. and JPMorgan Chase & Co. were next, followed by Warren Buffett’s Berkshire Hathaway conglomerate. Locally, supermarket giant Kroger Co. (NYSE: KR) was the second-biggest taxpayer. Its bill came to $957 million last year, ranking 96th nationally. Fifth Third Bancorp (Nasdaq: FITB) ranked third among local taxpayers and 164th nationally, paying $505 million in taxes last year. Kroger generated $2.9 billion in pretax income last year, while Fifth Third made $2.1 billion. That points to one very simple truth: “The more money you make, the more you pay in taxes,” Brandon Zureick, principal and fixed income portfolio manager at locally based money management firm Johnson Investment Counsel Inc., told me. So if a company is paying a lot in taxes, it’s probably doing pretty well. Larger companies are more likely to show up on this list simply because they make more in raw profits. Even though those three huge local companies paid the three highest income tax bills last year, they varied dramatically in another related area: their corporate tax rate. P&G gets more than half of its revenue from overseas. It pays lower foreign taxes on the profits it makes in other countries, so its effective tax rate – the amount it actually pays – came to about 23 percent last year, Zureick said. But Kroger generates all of its sales in the U.S. Fifth Third is almost strictly a domestic operation, too. Kroger pays taxes at a 33 percent effective rate, which is pretty close to the U.S. statutory corporate tax rate of 35 percent. Fifth Third’s rate is a little trickier to compare because other items factor into banks’ tax rates, but its rates are higher than companies with heavy foreign operations, too. "The real heart of the issue is the rate they’re paying," Zureick said. And that’s the issue that could change if the Trump administration is successful in getting Congress to cut corporate taxes. Kroger and Fifth Third actually stand to benefit more from tax reform than P&G and many other companies because they’re paying taxes at a higher rate, meaning there’s more room to cut, Zureick said. Throw in Cincinnati’s fourth-biggest payer of corporate income tax, department store operator Macy’s Inc., and three of Cincinnati’s four top corporate taxpayers have mostly domestic sales and stand to get a bigger gain from a cut in corporate taxes. Macy’s paid $341 million in taxes last year. The stock market is already anticipating changes to the corporate tax rate. “Those companies with a higher tax rate have mostly been viewed favorably in the market,” Zureick said. Kroger’s and Macy’s stocks have slumped this year because of competitive issues and the tentacles of online giant Amazon.com reaching into their businesses, but Fifth Third’s shares have jumped 30 percent since Election Day, thanks largely to a combination of expected reductions in bank regulations and the possibility of corporate tax cuts. But P&G stands to benefit from possible tax reform, too. One key proposal would allow companies with foreign profits to bring that money back to the U.S. without incurring another U.S. tax on it. “That would free up a lot of capital,” Zureick said. Then, P&G could bring home some of those billions in overseas profits to invest in the U.S. rather than keeping much of them overseas to invest elsewhere. P&G had a whopping $49 billion in undistributed earnings held in foreign subsidiaries as of June 30. Did you find this article useful? Why not subscribe to Cincinnati Business Courier for more articles and leads? Visit bizjournals.com/subscribe or call 1-866-853-3661.http://hogar.intelect.com.mx/notes/usa-p-g-is-the-biggest-local-payer-of-corporate-taxes-according-to-a-national-study-conducted-by-american-city-business-journalshttp://hogar.intelect.com.mx/@@site-logo/logoAllen.png
USA. P&G is the biggest local payer of corporate taxes, according to a national study conducted by American City Business Journals
These are Cincinnati’s biggest corporate taxpayers Steve Watkins 18 October 2017 Business Courier of Cincinnati Take a quick look at the list of Greater Cincinnati public companies that pay the most in corporate taxes and you probably won’t be surprised, but the difference in tax rates is a lot more eye-opening. Consumer products giant Procter & Gamble Co. (NYSE: PG) is the biggest local payer of corporate taxes, according to a national study conducted by Courier parent company American City Business Journals of how much big corporations across the country pay in taxes. It’s also by far the largest local company in market capitalization. P&G paid $3.3 billion in income taxes in fiscal 2016. That’s the 20th-biggest corporate tax bill in the country, ACBJ’s study found. Not coincidentally, P&G generated $13.4 billion in pretax income last year. It easily generated the most profits of any local company. Apple Inc. paid the most in corporate income taxes in the nation last year, footing a $15.7 billion bill. Huge banks Wells Fargo & Co. and JPMorgan Chase & Co. were next, followed by Warren Buffett’s Berkshire Hathaway conglomerate. Locally, supermarket giant Kroger Co. (NYSE: KR) was the second-biggest taxpayer. Its bill came to $957 million last year, ranking 96th nationally. Fifth Third Bancorp (Nasdaq: FITB) ranked third among local taxpayers and 164th nationally, paying $505 million in taxes last year. Kroger generated $2.9 billion in pretax income last year, while Fifth Third made $2.1 billion. That points to one very simple truth: “The more money you make, the more you pay in taxes,” Brandon Zureick, principal and fixed income portfolio manager at locally based money management firm Johnson Investment Counsel Inc., told me. So if a company is paying a lot in taxes, it’s probably doing pretty well. Larger companies are more likely to show up on this list simply because they make more in raw profits. Even though those three huge local companies paid the three highest income tax bills last year, they varied dramatically in another related area: their corporate tax rate. P&G gets more than half of its revenue from overseas. It pays lower foreign taxes on the profits it makes in other countries, so its effective tax rate – the amount it actually pays – came to about 23 percent last year, Zureick said. But Kroger generates all of its sales in the U.S. Fifth Third is almost strictly a domestic operation, too. Kroger pays taxes at a 33 percent effective rate, which is pretty close to the U.S. statutory corporate tax rate of 35 percent. Fifth Third’s rate is a little trickier to compare because other items factor into banks’ tax rates, but its rates are higher than companies with heavy foreign operations, too. "The real heart of the issue is the rate they’re paying," Zureick said. And that’s the issue that could change if the Trump administration is successful in getting Congress to cut corporate taxes. Kroger and Fifth Third actually stand to benefit more from tax reform than P&G and many other companies because they’re paying taxes at a higher rate, meaning there’s more room to cut, Zureick said. Throw in Cincinnati’s fourth-biggest payer of corporate income tax, department store operator Macy’s Inc., and three of Cincinnati’s four top corporate taxpayers have mostly domestic sales and stand to get a bigger gain from a cut in corporate taxes. Macy’s paid $341 million in taxes last year. The stock market is already anticipating changes to the corporate tax rate. “Those companies with a higher tax rate have mostly been viewed favorably in the market,” Zureick said. Kroger’s and Macy’s stocks have slumped this year because of competitive issues and the tentacles of online giant Amazon.com reaching into their businesses, but Fifth Third’s shares have jumped 30 percent since Election Day, thanks largely to a combination of expected reductions in bank regulations and the possibility of corporate tax cuts. But P&G stands to benefit from possible tax reform, too. One key proposal would allow companies with foreign profits to bring that money back to the U.S. without incurring another U.S. tax on it. “That would free up a lot of capital,” Zureick said. Then, P&G could bring home some of those billions in overseas profits to invest in the U.S. rather than keeping much of them overseas to invest elsewhere. P&G had a whopping $49 billion in undistributed earnings held in foreign subsidiaries as of June 30. Did you find this article useful? Why not subscribe to Cincinnati Business Courier for more articles and leads? Visit bizjournals.com/subscribe or call 1-866-853-3661.
These are Cincinnati’s biggest corporate taxpayers
Steve Watkins
18 October 2017
Business Courier of Cincinnati
Take a quick look at the list of Greater Cincinnati public companies that pay the most in corporate taxes and you probably won’t be surprised, but the difference in tax rates is a lot more eye-opening.
Consumer products giant Procter & Gamble Co. (NYSE: PG) is the biggest local payer of corporate taxes, according to a national study conducted by Courier parent company American City Business Journals of how much big corporations across the country pay in taxes. It’s also by far the largest local company in market capitalization.
P&G paid $3.3 billion in income taxes in fiscal 2016. That’s the 20th-biggest corporate tax bill in the country, ACBJ’s study found. Not coincidentally, P&G generated $13.4 billion in pretax income last year. It easily generated the most profits of any local company.
Apple Inc. paid the most in corporate income taxes in the nation last year, footing a $15.7 billion bill. Huge banks Wells Fargo & Co. and JPMorgan Chase & Co. were next, followed by Warren Buffett’s Berkshire Hathaway conglomerate.
Locally, supermarket giant Kroger Co. (NYSE: KR) was the second-biggest taxpayer. Its bill came to $957 million last year, ranking 96th nationally. Fifth Third Bancorp (Nasdaq: FITB) ranked third among local taxpayers and 164th nationally, paying $505 million in taxes last year.
Kroger generated $2.9 billion in pretax income last year, while Fifth Third made $2.1 billion. That points to one very simple truth: “The more money you make, the more you pay in taxes,” Brandon Zureick, principal and fixed income portfolio manager at locally based money management firm Johnson Investment Counsel Inc., told me.
So if a company is paying a lot in taxes, it’s probably doing pretty well. Larger companies are more likely to show up on this list simply because they make more in raw profits.
Even though those three huge local companies paid the three highest income tax bills last year, they varied dramatically in another related area: their corporate tax rate.
P&G gets more than half of its revenue from overseas. It pays lower foreign taxes on the profits it makes in other countries, so its effective tax rate – the amount it actually pays – came to about 23 percent last year, Zureick said.
But Kroger generates all of its sales in the U.S. Fifth Third is almost strictly a domestic operation, too. Kroger pays taxes at a 33 percent effective rate, which is pretty close to the U.S. statutory corporate tax rate of 35 percent. Fifth Third’s rate is a little trickier to compare because other items factor into banks’ tax rates, but its rates are higher than companies with heavy foreign operations, too.
"The real heart of the issue is the rate they’re paying," Zureick said.
And that’s the issue that could change if the Trump administration is successful in getting Congress to cut corporate taxes. Kroger and Fifth Third actually stand to benefit more from tax reform than P&G and many other companies because they’re paying taxes at a higher rate, meaning there’s more room to cut, Zureick said.
Throw in Cincinnati’s fourth-biggest payer of corporate income tax, department store operator Macy’s Inc., and three of Cincinnati’s four top corporate taxpayers have mostly domestic sales and stand to get a bigger gain from a cut in corporate taxes. Macy’s paid $341 million in taxes last year.
The stock market is already anticipating changes to the corporate tax rate.
“Those companies with a higher tax rate have mostly been viewed favorably in the market,” Zureick said.
Kroger’s and Macy’s stocks have slumped this year because of competitive issues and the tentacles of online giant Amazon.com reaching into their businesses, but Fifth Third’s shares have jumped 30 percent since Election Day, thanks largely to a combination of expected reductions in bank regulations and the possibility of corporate tax cuts.
But P&G stands to benefit from possible tax reform, too. One key proposal would allow companies with foreign profits to bring that money back to the U.S. without incurring another U.S. tax on it.
“That would free up a lot of capital,” Zureick said.
Then, P&G could bring home some of those billions in overseas profits to invest in the U.S. rather than keeping much of them overseas to invest elsewhere. P&G had a whopping $49 billion in undistributed earnings held in foreign subsidiaries as of June 30.
Did you find this article useful? Why not subscribe to Cincinnati Business Courier for more articles and leads? Visit bizjournals.com/subscribe or call 1-866-853-3661.
