Many of America’s largest corporations pay their CEOs more than they pay the US government in taxes, a new study has found.
Out of the 30 largest US corporations, seven had CEOs with a bigger annual salary than the amount they contributed to the federal government.
Researchers from the US-based think-tanks Centre for Effective Government and Institute for Policy Studies looked at the top 100 companies in America and found 29 CEOs received more in pay than their company paid in federal income taxes
The figure is a significant rise from 25 out of the top 100 in the researchers’ 2010 and 2011 surveys.
The 29 companies accused of the practice operate 237 subsidiaries in tax havens.
Campaigners have accused some multinational corporations of unethically minimising their tax bill to the detriment of the public finances.
The biggest gap between executive pay and taxes was at the financial services company Citigroup. Citigroup’s CEO earned $17.6m while the company qualified for a $260m tax refund.
Other companies where CEO renumeration surpassed tax avoidance included car manufacturer Ford and aerospace company Boeing, the researchers said.
“Our corporate tax system is so broken that large, profitable firms can get away without paying their fair share and instead funnel massive funds into the pockets of top executives,” said Scott Klinger, Director of Revenue and Spending Policies at the Center for Effective Government and a co-author of the report.
The report’s authors called on the US government to crack down on tax havens and close income tax loopholes that they said incentivised excessive CEO pay.
Corporate profits last year account for 10% of the US economy, the highest figure ever recorded.