Report: Walmart and Waltons Get $7.8B/Year in Tax Breaks, Subsidies

This blog was originally published by Making Change at Walmart.

A new report this week from Americans for Tax Fairness catalogs the incredible scale at which Walmart relies on the rest of us to pick up the tab for the company’s low wages and paltry benefits. It won’t be news to regular readers of this blog that taxpayers subsidize Walmart, but the total is really unbelievable The top-line conclusion of the report – Walmart and the Walton family benefit from more than $7.8 billion dollars in annual subsidies and tax breaks. Overall, the report estimated that our public schools could hire an additional 105,000 teachers with the $7.8 billion in annual subsidies and tax breaks received by Walmart and the Waltons. In addition, the Walton family uses specialized tax trusts to avoid estate taxes. The report estimates that the family has dodged upwards of $3 billion in taxes through these trusts. The report summarizes some of the subsidies and tax breaks covered this way:

  • Walmart receives an estimated $6.2 billion annually in mostly federal taxpayer subsidies. The reason: Walmart pays its employees so little that many of them rely on food stamps, healthcare and other taxpayer-funded programs.
  • Walmart avoids an estimated $1 billion in federal taxes each year. The reason: Walmart uses tax breaks and loopholes, including a strategy known as accelerated depreciation that allows it to write off capital investments considerably faster than the assets actually wear out.
  • The Waltons avoid an estimated $607 million in federal taxes on their Walmart dividends. The reason: income from investments is taxed at a much lower tax rate than income from salaries and wages.

There are increasing calls to end taxpayer support for poverty-wage employers around the nation.  No company and no family better exemplifies the need for change than Walmart, with $16 billion in profit last year and the Waltons, with more wealth than 42% of Americans combined. We support calls from taxpayer advocates and others around the nation to close needless loopholes that benefit billion-dollar companies and the super-wealthy, at the expense of average Americans.  Walmart associates shouldn’t have to rely on public assistance to get by, and taxpayers shouldn’t be on the hook for Walmart’s low wages.  We’re pleased that Americans for Tax Fairness and others are helping the public to understand more about this boondoggle.