General Electric’s Tax Payment Hoax

Earlier today, some media outlets picked up a hoax story that General Electric ($GE) was going to pay the government its $3.2 billion tax refund.

The hoax press release, which you can see here, claimed that GE CEO Jeffrey Immelt had informed the Obama administration that his company was returning $3.2 billion to the Treasury and “will furthermore adopt a host of new policies that secure its position as a leader in corporate social responsibility.”

The release included what seem to be some pretty obvious fake quotes, including this, attributed to Immelt: “All seven of our foreign tax havens are entirely legal. But Americans have made it clear that they deplore laws that enable tax avoidance. While we owe it to our shareholders to use every legal loophole to maximize returns – we also owe something to the American people. We didn’t write the laws that let us legally avoid paying taxes. Congress did. But we benefit from those laws, and now we’d like to share those benefits.”

The AP nonetheless ran a four-paragraph story that began, “Facing criticism over the amount of taxes it pays, General Electric announced it will repay its entire $3.2 billion tax refund to the US Treasury on April 18.”

The hoax was put out by some left-wing group. I honestly don’t understand what point they were trying to make. If anything, the idea of a company trying to buy the public’s affection with a tax payment needs to be spoofed as much as any corporate tax policy.

But let’s look past that and look at the numbers. A $3.2 billion check from GE would work out to about 30 cents per share. Meanwhile, GE’s stock has lost $40 per share (that’s 4,000 cents) over the last 10-and-a-half years.

Posted by on April 13th, 2011 at 12:21 pm


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