Every firm operating in the US market is liable to pay a fair amount of tax to the government. But taking advantage of loopholes in the system many firms prevent themself from paying taxes. So does the biggest departmental store in the USA – Walmart pay taxes or not?
As of 2021, Walmart pays a fair amount of taxes to the government. Indeed it is the highest tax-paying company among its competitors. Earlier there was a time when Walmart was alleged to taking advantage of loopholes in the system and not paying the taxes. But nothing was proved in this allegation. Now Walmart pays tax more than the legal corporate tax rate.
Walmart tax payment 2021
In 2021, Walmart paid $6,585 million annual income tax. There is an increase of 39.1% in the annual income tax payment of Walmart from 2020 to 2021.
Some companies do not pay taxes by taking advantage of loopholes in the system. But as of now, Walmart is fairly paying its fair sharing of corporate tax.
Walmart yearly tax payment
Walmart pays billions of dollars as tax to the US government. This year Walmart paid $6.585 billion as income tax. In 2020 Walmart paid $4.915 billion and in 2019 it paid $4.281. Walmart’s income tax payment is continuously increasing with each passing year. For the quarter that ended on October 31st, 2021, Walmart paid an income tax of $1.015 billion. There is a decline in the tax payment in this quarter by Walmart. There is a decline of 46.97%.
The Amazon Walmart rift over taxes
Walmart and Amazon are long-time rivals. Walmart is the largest departmental store in the USA. Whereas Amazon is the largest digital shopping platform in the USA. Therefore, the companies are each other’s biggest rivals.
Some time back amazon’s CEO Jeff Bezos indirectly targeted Walmart for its paying scale. Amazon challenged that none of their competitors pays more salary to their employees than amazon. Amazon also said they provide the best wages and perks to their employees. Walmart counter-attacked amazon on this by asking them about the tax payment.
Notably, Amazon is a major digital shopping company that earns an average revenue of $280 billion every year. But for the last two years, it has not paid any corporate income tax. They made use of the loopholes in the laws. Whereas Walmart is paying 31% to 36% of corporate tax. By this point, Amazon has lots of money pending to pay as a tax to the US government.
Tax payments of Walmart’s competitors
Walmart is the biggest departmental store in the USA. There is no doubt that it pays the highest income tax among its competitors. But do Walmart’s competitors also pay sufficient income tax?
Costco, Kroger, and Amazon are major competitors kg Walmart. Let us see how much income tax does these companies pay.
Costco is consistently paying the required sum of income tax. In 2020, the company paid $1,308 million in income tax. Before that, in 2019 the company paid $1,061 as income tax.
Kroger is also consistent in paying income tax. In the year 2020, the company paid $2,588 million in income tax. This was a huge increase of 71.16% as compared to the 2019 tax payment. In 2019 the company paid $1,512 million as income tax.
Amazon has not paid its corporate tax for the past two years. It is clear that the company is making use of the loopholes in the system to skip tax payments. Even President Joe Biden has shown serious concern about the issue of not paying income tax.
- Home Depot
Home Depot is one of the major competitors of Walmart. It paid $4,112 million in income tax in 2020. Whereas in 2019 it paid $3,473 million as income tax. In 2020, it paid 18.4% more tax than 2019.
Walmart is one of the highest tax-paying department stores in the USA. It paid the corporate tax 2021 at the rate of 31.2%, which is far more than the legal corporate tax rate of 21%. In the year 2021, the company paid an income tax of $6,585 million. There was a time when Walmart was alleged for tax dodging but nothing proved against the company.
- Does Walmart pay the right amount of tax?
Answer: The average legal rate of corporate tax is 21%. Whereas every year Walmart pays taxes between 31% to 36%. Therefore, this is clear that Walmart pays a fair amount of tax to the government
- How much income tax does Walmart’s CEO Douglas McMillon will pay?
Answer: In 2021 Douglas McMillon received a total salary of $20.9 million. Therefore he comes under the 37% rate category. So according to calculations, he is expected to pay a sum of $8.18 million as income tax.