In performing a quick review of SEC filings of large corps with an SEC State Location Code in Oklahoma, I found 4 large Corps with Total Core Consolidated Pretax Income of more than $4 bil each, for the most recent 12 years. All 4 were Oil and Gas Companies.
My Core Pretax Income excludes large Ceiling Test Asset Impairment Charges, which are huge for two of these Big Corps.....Devon Energy and Chesapeake Energy.
Below here is the effective state corporate income tax rates paid, which are computed by dividing the current state corporate income tax paid by the consolidated core pretax income, both in total for the past twelve years for these 4 large Oklahoma Corps. These 4 Oklahoma Corps below had a weighted average state corporate effective income tax rate paid of only 0.69%, or an 89% discount to Oklahoma’s current state corporate income tax rate of 6.00%.
….…………………….................Current………………….......State
….……………………...................State....Consolidated..Effective
….……………………...................Tax………..Pretax…….Tax Rate
….……………………...................Paid……...Income……….Paid
….……………….…...................(Millions of Dollars)
..4. Oneok…………………..........76………....5,201………...1.46%
..3. Williams Companies.......102……......8,156……......1.25%
..2. Devon Energy................140..........28,426(1)…....0.49%
..1. Chesapeake Energy..........69(3)......14,629(2).......0.47%
Total of the 4………................387…......56,412……......0.69%
(1) Exclusive of $19,272 mil of Reductions of Carrying Value of Oil and Gas Properties
(2) Exclusive of $14,786 mil of Reductions of Carrying Value of Oil and Gas Properties
(3) Chesapeake Energy did not disclose the amount of Current State Income Tax it paid. It did disclose the total of its Current Federal and State Income Tax, which totaled only $470 mil over the 12 year period. By applying relative tax rates, I estimated that the Current State Income Tax amount was $69 mil.
The effective state corporate income tax rate paid by these 4 Big Oklahoma Corps for the most recent six years is a somewhat lower 0.62%.
Also from my quick review, it appears that Tulsa-based Oil Driller Helmerich & Payne might be the next largest Oklahoma company. It generated Pretax Income in the past 12 years of $3,595 mil and paid State Corporate Income Tax of $60 mil, thus a modest effective state corporate income tax rate of 1.67%.
I think it makes much more sense to balance a State’s budget by closing some of the huge Big Corp State Corporate Income Tax Loopholes, rather than by reducing critical state services like education and citizen protection.
On the very positive side, as it relates to Oklahoma, kudos to Senator Tom Coburn on voting for the Deficit Commission Report. Coburn is a true champion in fighting to reduce the US Deficit and making the tough vote, even though there are many specific items in the Report that he didn't agree with.....and the same compliment goes to Idaho Senator Mike Crapo, who I think might be the wisest Republican on economic issues in the US Congress.....and also to visionary Illinois Senator Dick Durbin, who exhibited such guts here, to New Hampshire Senator Judd Gregg, to North Dakota Senator Kent Conrad, and to South Carolina Congressman John Spratt.
But I have to ask, just where were the gutless Republican US House members on this critical vote, so important to the country's fiscal future?....the US Deficit Reduction is their major issue. What hypocrites Jeb Hensarling of Texas, Paul Ryan of Wisconsin, and Mike Camp of Michigan are! I am sure that many other people, who followed this closely, were as very disappointed in these three as I am....these three very bright guys, and staunch public advocates of massive US deficit reduction, really let US citizens down on their NO vote on this Deficit Commission Report Recommendation that would reduce the US Deficit by $4 trillion over just the next decade. Senate Republicans Coburn, Crapo and Gregg don't just say they want to massively reduce the US Deficit, they also act to do so. Not these three selfish, close-minded House Republicans. Shame on them.
