• Feb 23rd 2011 at 6:30PM
  • 58
It looks like General Motors will be able to skip out on around $14 billion worth of taxes domestically and another $19 billion in taxes overseas thanks to a deal with the U.S. government. According to Edmunds, 2010 will mark the first year since 2004 that the company has operated in the black, and while most companies are made to pay taxes on their revenue, GM will be able to skip its tax tab due to years of massive losses. Companies are typically forgiven a portion of future taxes due to their past losses, but that benefit is typically stripped after an organization goes through bankruptcy.
That's not the case with GM, however. For reasons that aren't entirely clear, The General has managed to hang on to its tax breaks despite shedding around $30 billion in debt during bankruptcy proceedings. According to CNN Money, both GM and the Treasury Department deny that the automaker has received any special deal, though Edmunds reports that GM may have gotten the break to help reduce the perceived cost of the auto industry bailout.

[Sources: Edmunds, CNN Money]

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    • 1 Second Ago
      • 4 Years Ago
      This is a surprise?

      The sweet heart deals negotiated with Government Motors by this Administration are numerous:

      - GM got to screw bondholders - contrary to centuries of legal precedent
      - GM negotiated a sweetheart deal with the Treasury that had the US taxpayers SCREWED to the tune of $700 million in the first way of stock sales.
      - GM and the UAW negotiated a wonderful deal for their stock sale so that the union was bailed out at a profit.
      - Government Motors is using money from the bailout to expand in China - this is obvious because Government Motors hasn't made enough profits to finance both their domestic automotive program AND the Sino Expansion.
      -Government Motors has a tepid amount of job growth in the United States compared to its employment overseas - especially in China - while using US tax dollars for that chinese expansion.

      This deal stunk the moment it was proposed and it is one of the worst deals ever negotiated for the American Taxpayer who has already paid over $1.6 billion in interest charges to the Chinese just to cover this deficit spending.
        • 4 Years Ago
        GM didn't do the first 3 items on your list. Your government dictated that situation.

        If GM was in control for any of that, the old owners wouldn't have lost all their ownership either.
        • 4 Years Ago
        You forgot to mention the assistance GM got from the government witch hunt (proven by 2 government agencies no less) of Toyota.

      • 4 Years Ago
      Remember this when you buy your next car. I've bought many GM cars; never again! Think about how this creates an unfair playing field for Ford and support them.
      • 4 Years Ago
      The money goes round and round, just like the wheels on the bus that carry protesters in.

      Government -> unions -> Government -> unions... the government protects union jobs, which create dues, to pay government lobbies and get dems elected, who protect union jobs, to create dues, to pay lobbies, to elect dems, to protect unions, to create dues....

      In the real world, this is called racketeering, corruption, extortion, assault if the unions get excited, and generally CRIME.

      Unions, Corporations, and Governments should have CLEAR lines of demarcation between them. They are not all supposed to be corrupt together, serving each other at the EXPENSE of the taxpayers under force of law. I can't decide not to pay my taxes into this bloody cess-pool.
      • 4 Years Ago
      I'm against this, and I've always been against this, but people who think this is anything new or special is in need of a serious reality check. Huge corporations have been getting gigantic tax breaks and welfare for decades. People who didn't care about this kind of thing before suddenly jabber about "socialism" and that it's the fault of the unions somehow, completely ignoring the fact that this isn't what socialism actually is and that it's the CEOs and executives benefiting from these tax breaks. This isn't "Government Motors," this isn't something Obama came up with, and this certainly isn't socialism. This has been the system for years, and while I support people getting mad as hell about this, it's extremely important to know the history, the context, and who's to blame.
      • 4 Years Ago
      ok i dont think most people look at his the right way , this is an american company that will give more Americans jobs and money places like china pay for there industry it is just helping to keep more americans with jobs... this sounds naive but i dont look at this as such a bad thing..
      • 4 Years Ago
      Wow. This is VERY old news. I thought even AB posted this about a year ago. You don't want to make a habit of reposting CNN and CNNMoney posts. They refresh and relink their articles on a regular basis. Anyone who paid attention to the bankruptcy proceedings was aware of this "deal" a long time ago.
      • 4 Years Ago
      and ANYONE who comes in here complaining about this... has either never had to pay taxes.. or.. if they have... has never ever taken any type of deduction or break offered by the law. A Corporation by definition is essentially a live entity. GM's Accounting did nothing more than any one else would do on either of the 15ths.
      • 4 Years Ago
      Next time the gov't is wanting to spend $20 million on some pet project that is utterly useless in all manners, and there is public opposition, if they just tell everyone to go drown themselves, it'll justify the issue.

      The auto bailout wasn't useless, but your "cross your arms and stomp out of the room with your head tilted down in anger" type mentality is moronic.
        • 4 Years Ago
        "Next time the gov't is wanting to spend $20 million on some pet project that is utterly useless in all manners." Try the EPA and the DOJ as being in the useless categories.
      • 4 Years Ago
      Long live Gub'ment motors: get a block of cheese with the purchase of a new car.
      • 4 Years Ago
      I think its sad/funny that everyone is outraged by this. Look most of the largest corporations do not pay taxes, its a very normal thing. Why do you think they lobby so hard for? the reason its sad/funny to me is it happens every year and no one seems to care or even know. Also keep in mind that they get incentives for lots of things on top of not paying taxes.

      We are quickly becoming a Fascist state

      wake up and stop voting for the same media darling big government candidates with their empty promises
      • 4 Years Ago
      'while most companies are made to pay taxes on their revenue'

      Which companies pay taxes on revenue? The companies I know of pay taxes on profits (if that).
      • 4 Years Ago
      Obviously this is totally kosher as we don't need the money anyways
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