Elizabeth Warren's new corporate profits tax would cost Amazon $698M, she says

By U.S. EconomyFOXBusiness

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Democratic Massachusetts Sen. Elizabeth Warren – who is campaigning for her party’s nomination in 2020 – unveiled a new tax proposal on Thursday aimed at corporate profits, criticizing Amazon for paying no federal income tax last year.

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Warren said that the average American will likely be paying "something" in federal taxes this year, which is more than some of the country’s biggest companies can say.

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“In fact, year after year, some of the biggest corporations in the country make huge profits but pay zero federal corporate income taxes on those profits,” she said, citing Amazon, which has come under scrutiny for allegedly paying no taxes in 2018.

Warren said that due to “loopholes” in the tax code, companies can tell shareholders they have made billions in profits, but can end up paying no corporate income taxes.

An Amazon spokesperson fired back on Thursday, however, saying the company pays "all the taxes we are required to pay in the U.S., and every country where we operate." According to the spokesperson, Amazon paid $2.6 billion in corporate tax and reported $3.4 billion in tax expense over the last three years.

But Warren, in a tweet, responded to Amazon's defense.

"In response to my plan, Amazon says it 'pays all the taxes we are required to pay in the US,'" she tweeted. "Yeah, I know. You made more than $10 billion in profits last year and you were required to pay $0 in federal corporate taxes. That's the problem."

Warren’s bill – dubbed the Real Corporate Profits Tax – would only apply to companies that report more than $100 million in profits. The first $100 million would be untouched, but for every dollar of profit above $100 million earned, the company would pay a 7 percent tax. That tax would be levied in addition to other taxes owed under the current tax structure.

It would also be assessed on the amount reported to shareholders, not what is reported to the IRS.

According to Warren’s calculations, her proposal would cost Amazon $698 million, as opposed to the $0 it reportedly paid – a figure it has refuted.

Warren opted for this route instead of raising the corporate tax rate in order to prevent companies and their “armies of lawyers” from finding loopholes.

It's not her first jab at Amazon, which was named as a target in her plan to break up big technology companies.

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Warren previously announced a wealth tax proposal aimed at those with more than $50 million in assets.

Meanwhile, an executive from Walmart took aim at Amazon over allegations it paid no federal income taxes last year, after Amazon CEO Jeff Bezos appeared to target the retail behemoth for not paying a $15 minimum wage.