PATRICK COLUMN: Biden on Amazon: Chickens come home
Published 12:06 am Tuesday, June 18, 2019
Presidential candidate Joe Biden slammed Amazon for not paying any federal income taxes last year — mimicking comments from Bernie Sanders and Elizabeth Warren. Amazon defended itself by posting a tweet claiming it paid $2.6 billion since 2016.
Who’s telling the truth? They both are, in their own fashion. But ironically, one of the politicians who helped create the tax system that has benefited the tech giant is … Joe Biden.
It all started last week when Biden tweeted: “I have nothing against Amazon, but no company pulling in billions of dollars of profits should pay a lower tax rate than firefighters and teachers. We need to reward work, not just wealth.”
And Amazon clapped back: “We’ve paid $2.6B in corporate taxes since 2016. We pay every penny we owe. Congress designed tax laws to encourage companies to reinvest in the American economy. We have. $200B in investments since 2011 & 300K US jobs. Assume VP Biden’s complaint is w/the tax code, not Amazon.”
Tax experts have pointed out that Amazon took advantage of numerous, and very legal, tax credits like the research and development credit, the investment credit, and stock-based compensation for its employees.
As a U.S. senator for 36 years and vice president to Barack Obama for eight years, Biden had ample opportunity to help change these laws and eliminate these credits. In fact, he and Obama campaigned on doing just that.
During a 2012 debate against Paul Ryan (Mitt Romney’s running mate), Biden said that if he and Obama were re-elected, “The middle class will pay less, and people making a million dollars or more will begin to contribute slightly more. Let me give you one concrete example: the continuation of the Bush tax cuts. We’re arguing that the Bush tax cuts for the wealthy should be allowed to expire.”
In that same debate, Biden also said it was “mathematically impossible” to close all the loopholes in the tax code. But today he’s joined the bandwagon of progressives complaining about Amazon using these so-called “loopholes” to lower their tax liability.
But then-vice president Biden caved to GOP pressure to extend Bush’s tax cuts for the rich and reduce tax cuts for the middle class in 2010. Because Biden often cut deals with Republicans during the Obama years, progressives think he won’t actually pursue progressive policies like Sanders or Warren will (both Sanders’ and Warren’s voting records are consistent with their presidential policy proposals).
According to data compiled by the Institute on Taxation and Economic Policy, Bush, Obama and Trump all gave the biggest tax cuts to the rich (although during the Obama administration, the poorest 20 percent got the same tax cut as the richest 20 percent).
Furthermore, the Obama administration strongly supported cutting the corporate tax rate, which was 35 percent at the time, to 28 percent. They also argued for lowering the cost of business investment by 75 percent to encourage business growth, which benefitted Amazon.
(Amazon and other Big Tech companies were top lobbyists to the Obama administration.)
Former Obama aides told The Daily Beast that Biden is either being naive or simply spouting lies. When Biden announced his presidential bid in April, The Intercept reported that corporate lobbyists and GOP donors made up the host committee of his first fundraising event.
Adding yet another note of irony: Joe Biden is also the only major Democratic candidate who has not released his tax returns.
Kate Patrick reports technology and finance news for InsideSources.com.