GE Defends Tax Record, Attacks New York Times In Twitter Campaign

After a damning New York Times story accusing General Electric of having paid $0 in American taxes despite $5.2 billion in domestic revenue, the company is fighting back--by Twitter.

In a peculiar gambit, GE's strategy seems to be to use Twitter --via @GEpublicaffairs, a still uncertified account--to respond to a random assortment of writers at various outlets totally unaffiliated with the New York Times, who just happened to tweet the story at some point.

Recipients of @ replies from the GEpublicaffairs account include such figures as Slate's tech columnist Farhad Manjoo, Business Insider editor-in-chief Henry Blodget, and a slew of other writers from places including the National Journal and Atlantic Wire.

Though most received the form response "@_____ learn more GE tax facts visit http://bit.ly/ea6Ay2" followed by nuggets contradicting the Times story, like "GE paid almost $2.7 billion in cash taxes in 2010" and "GE didn't receive payment back from govt as a result of the tax benefit," others, like the Business Insider main account were harangued to "Stop the misleading attacks."

The GE public affairs account calls the Times story "inaccurate," "erroneous," and "grossly oversimplified."

But some people GE has reached out to with an @ reply seem less than convinced. Carla Zilka tweeted, "I don't know if NYT would print false facts re: GE, so someone is not being, ahem, "honest.""

The dispute: what kind of taxes constitute that $2.7 billion GE claims to have paid? @khivi tweeted "@Gepublicaffairs tweets confirm @nytimes that GE paid $0 corporate tax," to which GE responded "They are separate. Of $2.7B income tax paid, signf portion was US fed. GE also paid $1B+ in payroll, state & local use & property tax."

Henry Blodget, in particular, has engaged in an interrogation of the account. After asking them whether the Times was wrong about GE's $0 US tax bill, GE Public Affairs responded, "Well, GE paid U.S. $2.7B in cash taxes in 2010."

At this point, he dragged the Times' Bill Keller into the fight, tweeting, "If I'm not mistaken, GE has now said that the NYT story saying it paid no US taxes last year is flat-out wrong. @gepublicaffairs @nytkeller"

Interestingly enough, though, Blodget goes a step further than the official GE response, which, while calling the story "distorted and misleading," skirts around actually saying the story is "wrong."

Comments

[p456]

08:39 AM on 03/30/2011

This is how GE explains it's tax returns.

“Let’s see, worldwide profits of $14.2 billion, including $5.1 billion from U.S. operations, MINUS DEPRECIATION of progressive politicians, ignorant middle class citizens SHELTERED by FOX NEWS, and GREEN CREDITS for our world ‘s biggest wind turbines blowing smoke in everyone’s eyes … and the GOVERNMENT OWES G.E. $3.2 BILLION!”

[JPETERB]

12:12 AM on 03/30/2011

Sounds like a US consumer boycott of GE would be useful if GE still makes any consumer products for sale in the US.

[nixrox04]

08:23 AM on 03/30/2011

They do still sell consumer products in the US. In fact, I recently had a GE home dehumidifier that was Made in China recalled on warranty because they had a defect that, in some cases, started home fires. When I contacted the local GE dealer he didn't even bother to call back. Eventually, I found out you had to take the unit to a Sears Dealer to get it repaired AND then you had to sign a waiver that if the repairman could find anything else wrong, you had to pay $35.00. It took weeks to get it repaired. The only positive experience was that the nearby Sears franchise is owned by a local guy that really cares about a job done well and followed through with the repairs.

[Speeran]

08:27 PM on 03/29/2011

Continued from prior post....large corporations (and GE is but one) can use Consolidation by timing gains and losses in different subsidiaries in completely different lines of business to take place simultaneously so they can offset or carry forward losses from one to offset gains in another. We have much the same power as taxpayers with regards to business income, with the exception that it is difficult to offset losses from personal business income against our salary income....it seems to me corporations should face a similar limitation where losses should only be able to offset gains from a similar business.

[banana republican]

08:24 PM on 03/29/2011

Y'all do realize don't you, that Obama just recently named GE CEO, Jeffery Immelt as the head of one of his economic advisory boards, right? And GE owns NBC which can report favorable or unfavorably on Obama. Why is it a surprise they get away with not paying taxes?

[ka0226]

08:29 PM on 03/29/2011

No surprise here. Obama is working for the corporations just like Bush was.

[Speeran]

08:11 PM on 03/29/2011

Ok, for the two or three of you actually interested in understanding what really happened, here goes: GE makes money in the US and abroad. The money made in the US is taxed in the year it is made and most of the money made abroad is taxed when it is repatriated as dividends subject to a credit for the foreign taxes paid. GE (and any US Corporation) is able to wait and then mix dividends and their associated foreign taxes in such a way that they completely offset any US taxes due on the foreign income. Close that loophole, you say? Most foreign countries exempt foreign dividend income altogether....so in that event all GE would need to do is spin off a company in charge of foreign sales and reincorporate it in a foreign jurisdiction that does not tax foreign dividend income.

So that brings us to GE's @$5 BN in US 2010 income because:
1. GE Capital lost a great deal of money in 2008 and can "carry forward" that loss to offset 2010 income,
2. The US allows Corporations to offset the losses from its losing subsidiaries against those from its winners under it's Consolidation rules. GE offset the losses of it's Capital business against the gains from Industrial businesses.
The latter is the biggest "loophole" in the US tax system,

[Ukie3]

08:06 AM on 04/04/2011

Seems to make the most sense out of all the other crazy $h.it being posted around here, thanks!
Fan #1!

[Laughert9]

07:44 PM on 03/29/2011

G.E.= government entity.

[DemocracySimulation]

07:38 PM on 03/29/2011

I like this tweet. Copy, paste at your will:

@GEpublicaffairs Diary of a sociopathic corporate "person." Dodging income taxes, aka "earned" tax credits, while offshoring American jobs.

[FilthyHarry]

07:36 PM on 03/29/2011

This is a tuff call, both GE and NYT have no credibility. Who to disbelieve more?

[Lost Rights]

06:56 PM on 03/29/2011

They claim to have paid 2.8 billion. Even so, with 14.5 billion profits, what is that rate, still not so much. Add back the 3.2 billion benefits, and what is their tax rate? So, they didn't think before they spoke, saying, 'we don't pay nothing, we pay about 5%, about 3% after those benefits.

[JPE33180]

05:08 PM on 03/29/2011

No apologies for GE here. They are playing with the language implying that they paid taxes via payroll taxes, property taxes and sales tax but won't say how much they paid on their income or profits.
All companies play some form of this shell game because the truth makes them look like freeloaders or freeriders. HCA did it back in the Rick Scott CEO days - no wonder why he wants to make not-for-profit hospitals pay taxes now that he is Gov of Florida.

[TheBatDan]

04:14 PM on 03/29/2011

Make money in the US and ship it to an account in another country....you know who else practices this??? Illegal Immigrants.

[DemocracySimulation]

07:40 PM on 03/29/2011

Or the mob or drug cartels. Difference between your illegal immigrant scape goat is that we are talking BILLIONS not a few thousand a year at best from working an underpaid job no American would take.

[GEfreedom]

03:38 PM on 03/29/2011

AT LAST! Hear GE's side of the story on Twitter:
@GEfreedomreport

[EinChicago]

04:10 PM on 03/29/2011

Ummmm. Really? I mean, really? There are no "sides" to this. There are facts: did GE pay taxes last year or not?
Yes or no.

[JPE33180]

05:01 PM on 03/29/2011

On its profits or income. Don't include payroll taxes, property taxes, sales taxes - we all pay those. GE will try to obfuscate on this as did HCA back in the good old Rick Scott as CEO days.

[Connor Alexander]

06:03 PM on 03/29/2011

Ha, I say. Ha.