CEO Pay Loopholes Cost Taxpayers $20 Billion Each Year
A new report shows tax and accounting loopholes allow top executives and corporations to avoid paying about $20 billion a year in taxes. The report, Executive Excess 2008: How Average Taxpayers Subsidize Runaway Pay, released this week by the Institute for Policy Studies and United for a Fair Economy, calculates the annual cost to taxpayers of the five tax and accounting loopholes that encourage excessive executive pay. Even worse: Many large corporations are not paying any taxes at all.
The authors point out that the average CEO of a large U.S. company last year received $10.5 million in total compensation, 344 times the pay of the average U.S. worker. Thirty years ago, the ratio was 35:1. The top 50 private equity and hedge fund managers in 2007 pocketed an average of $588 million each, or 19,000 times as much as the average worker.