Though it made $1.4 billion in profits last year Traveler's, the Hartford-based insurance giant, got back a $176 million tax refund from the Internal Revenue Service. It is one of several entities in the state that makes millions, or even billions, of dollars in profits each year but finds ways under the current federal tax structure to avoid paying taxes, according to a story in the Connecticut Mirror.
The story is based on a report by the Institute for Policy Studies, called "Executive Excess 2012: The CEO Hands in Uncle Sam's Pocket." In it, the Washington, D.C.-based think-tank says that while public sector budget cuts "have axed 627,000 public service jobs just since June 2009," billion-dollar companies and their highly paid chief executives have found ways to avoid paying taxes that would help ease the burden on the middle and lower classes.
"These tax dollars are flowing from average Americans who depend on public services to the kingpins of America’s private sector. They’re subsidizing, directly and indirectly, the mega-million paychecks that go to the top executives at our nation’s biggest banks and corporations," the Institue says.
In Connecticut, the Mirror reports, "Travelers and other large corporations, including AT&T, Boeing and Citigroup, used provisions in the tax code to pay little or nothing in taxes while their CEOs averaged $20.4 million in compensation."