How Taxpayers Subsidize America’s Biggest Employer and Richest Family

Search form

How Taxpayers Subsidize America’s Biggest Employer and Richest Family

How Taxpayers Subsidize America’s Biggest Employer and Richest Family
Tue, 4/15/2014 - by Americans For Tax Fairness
This article originally appeared on Americans For Tax Fairness

On tax day, when millions of American taxpayers and small businesses pay their fair share to support critical public services and the economy, they will also get stuck with a multi-billion dollar tax bill to cover the massive subsidies and tax breaks that benefit the country’s largest employer and richest family.

Walmart is the largest private employer in the United States, with 1.4 million employees. The company, which is number one on the Fortune 500 in 2013 and number two on the Global 500, had $16 billion in profits last year on revenues of $473 billion.

The Walton family, which owns more than 50 percent of Walmart shares, reaps billions in annual dividends from the company. The six Walton heirs are the wealthiest family in America, with a net worth of $148.8 billion. Collectively, these six Waltons have more wealth than 49 million American families combined.

This report finds that the American public is providing enormous tax breaks and tax subsidies to Walmart and the Walton family, further boosting corporate profits and the family’s already massive wealth at everyone else’s expense. Specifically, our analysis shows that:

Walmart and the Walton family receive tax breaks and taxpayer subsidies estimated at more than $7.8 billion a year – that is enough money to hire 105,000 new public school teachers.

The annual subsidies and tax breaks to Walmart and the Waltons include the following:

Walmart receives an estimated $6.2 billion annually in mostly federal taxpayer subsidies. The reason: Walmart pays its employees so little that many of them rely on food stamps, health care and other taxpayer-funded programs.

Walmart avoids an estimated $1 billion in federal taxes each year. The reason: Walmart uses tax breaks and loopholes, including a strategy known as accelerated depreciation that allows it to write off capital investments considerably faster than the assets actually wear out.

The Waltons avoid an estimated $607 million in federal taxes on their Walmart dividends. The reason: income from investments is taxed at a much lower tax rate than income from salaries and wages.

In addition to the $7.8 billion in annual subsidies and tax breaks, the Walton family is avoiding an estimated $3 billion in taxes by using specialized trusts to dodge estate taxes – and this number could increase by tens of billions of dollars.

Walmart also benefits significantly from taxpayer-funded public assistance programs that pump up the retailer’s sales. For example, Walmart had an estimated $13.5 billion in food stamp sales last year.

Polls show that Americans want a tax system that requires large corporations and the wealthy to pay their fair share. This report shows that our current system is anything but fair – rather it provides special treatment to America’s biggest corporations and richest families leaving individual taxpayers and small businesses to pick up the tab.

Walmart, the world’s largest private employer, and the Walton family, which owns a majority of Walmart shares, benefit from an estimated $7.8 billion in annual tax breaks, loopholes, and subsidies. The largest share of this windfall – an estimated $6.2 billion in Walmart on Tax Day subsidies to Walmart – comes in the form of public assistance provided by taxpayers to low-wage Walmart employees.

At the same time, Walmart profited from an estimated $13.5 billion in sales last year to shoppers using SNAP (food stamp) benefits. Meanwhile, the Waltons get more than $600 million annually in savings from the preferential tax rate on their Walmart dividends. And the Waltons are also using special tax trusts to avoid an estimated $3 billion in estate taxes – an amount that could grow by tens of billions of dollars in years to come if the family creates more of these trusts. If, instead of dodging their taxes Walmart and the Waltons paid their fair share, the increased revenues could be used to fund vital public services and reduce the deficit.

Go here to view the full report.

Originally published by Americans For Tax Fairness

Article Tabs

Boris Nemtsov, Russia repression, Russia protests, Russian opposition movement, Alexei Navalny, Vladimir Putin

"If political views are punished this way, then this country simply has no future," Sergei Mitrokhin, an opposition leader, said of Nemtsov's murder.

Agreeing to Investor-State Dispute Settlement in this enormous new treaty would tilt the playing field in the U.S. further in favor of big multinational corporations – worse, it would undermine U.S. sovereignty.

union busting, Scott Walker, right to work, Madison protests, Wisconsin AFL-CIO, Wisconsin Citizen Media Cooperative, Wisconsin Jobs Now

Wisconsin unions bussed thousands of workers from around the state on Saturday to demonstrate against the impending adoption of a law to ban private-sector workers from being required to join a union or pay dues.

Occupy.com's New Original Series: Act Out! Premiers March 4th, Watch the Trailer Now!

Charlie Hebdo, ISIS killings, LGBT threats

A human rights commission report warns that anyone believed to be LGBT under the Islamic State control is likely at imminent risk of death.

Through "evergreening,” pharmaceutical companies could could retain ownership of and royalties to drugs for which their patents have expired – limiting access to generic forms of medicine that millions need.

Posted 5 days 14 hours ago

It's not easy writing a play about injustice in America much as it's not easy telling the complex, multi-layered story of the Occupy movement – something Catherine Hurd set out to do in her musical that premieres this week.

Posted 5 days 14 hours ago
Radical Independence Campaign, Scottish fracking moratorium, Scottish National Party, fracking ban, #GreenSurge

Following last month's decision to place a moratorium on fracking, widespread Scottish opposition is growing to other unconventional methods of fuel extraction.

Posted 6 days 16 hours ago
Killswitch, Lawrence Lessig, Tim Wu, Peter Ludlow, hacktivists, Aaron Swartz, Edward Snowden

Will this film be a cautionary tale of what happens when you dare to take on elite power structures – or will it be the spark that ignites a revolution that will redefine democracy in the digital age?

Posted 6 days 16 hours ago
tax the rich, raising taxes, wealth inequality, income inequality, taxing the wealthy, middle-class economics

Sixty-eight percent say wealthy households pay too little in federal taxes, 60 percent say the middle class pays too much, and more than half favor raising capital gains taxes on households of $500,000.

Posted 6 days 15 hours ago

As the European Commission president who helped define Europe's austerity-driven financial policies, Barroso advocated doing "whatever is necessary to make sure the euro thrives and to regain the trust of financial markets.”

Against the backdrop of violence and greed, this character – the Activist – shows up again and again throughout the story of the U.S., refining the tools of nonviolent action into something as American as apple pie.

It's not easy writing a play about injustice in America much as it's not easy telling the complex, multi-layered story of the Occupy movement – something Catherine Hurd set out to do in her musical that premieres this week.

Goldman Sachs, California school district bonds, capital appreciation bonds, Bank of North Dakota, public banking

In 2008, after collecting millions of dollars in fees to help California sell its bonds, Goldman urged its bigger clients to place investment bets against those bonds – a scam ensnaring future generations in mountains of debt.

Killswitch, Lawrence Lessig, Tim Wu, Peter Ludlow, hacktivists, Aaron Swartz, Edward Snowden

Will this film be a cautionary tale of what happens when you dare to take on elite power structures – or will it be the spark that ignites a revolution that will redefine democracy in the digital age?

Sign Up