Nike, along with several other large American corporations, have avoided paying any federal income tax over the last three years, according to a report by The New York Times.
The legal tax avoidance was enabled, in part, to a sweeping tax bill from 2017 that reduced the corporate tax rate from 35 percent to 21 percent. Further reductions were achieved through a variety of legal deductions and exemptions that have been written into the tax code. These legal loopholes allowed some of the biggest companies – Nike, FedEx, and Duke Energy among them – to avoid paying any federal income tax for three years in spite of a reported combined profits totalling $77 billion, in addition to millions of dollars in tax rebates.
Cost to consumers:
Nike Air Max 270s: $150
Dish Network basic package: $64.99
FedEx “large” box delivery: $20.00
Zoom Pro monthly membership: $14.99
Federal income taxes paid in 2020:
Dish Network: $0
Yes. We must end our rigged tax code.
— Bernie Sanders (@BernieSanders) April 4, 2021
Furthermore, a provision from the $2.2 trillion CARES Act (initially set up to offset the financial effects of the pandemic) was also used by companies to use losses in 2020 to offset profits earned in previous years, according to findings from the Institute of Taxation and Economic Policy.
Bernie Sanders tweeted that “If you paid $120 for a pair of Nike Air Force 1 shoes, you paid more to Nike than it paid in federal income taxes over the past 3 years, while it made $4.1 billion in profits and Nike’s founder, Phil Knight, became over $23 billion richer” before ending the tweet with a pledge to #TaxtheRich.
In spite of the high profits, elsewhere at Nike people just don’t seem to be feeling the recent Nike x Kim Jones collaboration.