Profits for online retail behemoth Amazon soared in 2018, but it paid no federal income tax for the second consecutive year, according to a report published Wednesday.
The Institute on Taxation and Economic Policy says the company is subject to a 21 percent tax rate on its US income. However, through various tax breaks and credits, the company will receive a tax rebate of $ 129 million.
That's about doubling its profits to $ 11.2 billion in 201
The organization explained the negative tax rate this way: "The fine print of Amazon's income tax disclosure shows that this achievement is partly due to various unspecified tax credits as well as a tax break for executive stock options. "In April 2018 Motley Fool analysis declared that Amazon is a" master of tax avoidance. "
CNN explains that the US tax code allows companies to reduce their future taxable income. That has worked in Amazon's favor because it has been market with billions of dollars in losses and some of its profits come from global sources not subject to the US.
CNN notes that the company has recently paid hundreds of millions of dollars in state taxes and more than a billion dollars in international taxes.
President Donald Trump has criticized Amazon for its tax practices in the past. In March 2018, Trump tweeted that the company pays "little or no taxes to state & local governments" and allegedly the company abused the postal system.
In its analysis, ITEP criticized the Trump administration for the 2017 Tax Cuts and Jobs, which ITEP does not close tax loopholes that profitable companies can use to avoid paying income taxes
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