Somebody probably just got a bonus at General Electric, where profits jumped a whopping 77 percent in the first quarter of this year. According to the Wall Street Journal, an impressive turnaround by the company's one-time cash cow GE Capital as well as a huge backlog in orders for industrial equipment. The profit grand total? $3.4 billion.
It's probably just a coincidence but $3.4 billion comes pretty close to the $3.2 billion figure that the company claimed in tax benefits last year. Employing nearly a thousand people in its tax department and spending nearly $200 million on lobbying, GE managed to avoid nearly all taxes for 2010 according to a recent report by the New York Times' David Kocieniewski. The company denied the allegations by pointing out that their tax rate had lowered due to the economic crisis and they had followed federal tax laws according, a practice the Times called "exploiting loopholes." They would pay more taxes in 2011, the statement says. Despite the controversy, GE's CEO Jeff Immelt kept things positive in his statement regarding today's news:
GE has emerged from the recession a stronger, more competitive company. The GE business model will continue to deliver earnings growth for shareowners in 2011 and beyond.