More than 100 of the largest and most profitable U.S. companies paid no federal income tax in 2025, including corporate heavyweights Citigroup, Tesla, and Walt Disney, according to a new report.
The analysis found that more than 700 large, profitable public companies paid federal tax at an overall rate of 10.4% in 2025, and that 114 of those firms paid no tax at all. That's the lowest effective tax rate reported by the Institute on Taxation and Economic Policy in more than 40 years of studying corporate tax rates. ITEP is a nonpartisan, left-leaning think tank.
Tax laws enacted under President Donald Trump cut the federal corporate tax rate from 35% to 21%. Trump and Congress also extended or expanded tax breaks that allowed many companies to pay
tax at an even lower rate than 21% in 2025.
Defenders of the tax cuts note that Trump and Congress also broadened the tax base, curbing deductions to offset the cuts.
Advocates of the Trump tax cuts say lower tax rates allowed corporations to invest and grow. Even after the cuts, revenues from corporate taxes are higher now than when Trump first took office, though revenue slipped in 2025.
Profitable companies paid no income tax in 2025
The 114 companies that paid no federal income tax in 2025 include some big names, according to ITEP:
- Citigroup, with $4.4 billion in profits in 2025.
- CVS Health, with $8 billion in profits.
- Duke Energy, with $5.5 billion in profits.
- Tesla, with $5.7 billion in profits.
- United Airlines, with $4.3 billion in profits.
- Walt Disney, with $8.3 billion in profits.
The report says Congress and Trump treated large corporations to a menu of tax cuts and loopholes they did not need, costing the nation hundreds of billions of dollars in lost tax revenues at a moment when the national deficit approaches $2 trillion.
"In a fiscally challenging environment, when the federal government is unable to balance its budget, every dime of taxes we’re not collecting is a problem," said Matt Gardner, a senior fellow at ITEP. "And this report documents $198 billion worth of problems in 2025."
That is the total value of corporate tax subsidies taken by the 706 companies ITEP studied in 2025, pushing their effective tax rate below the benchmark rate of 21%, the report says.
Are corporate tax rates too low under Trump?
Whether corporations pay their fair share of taxes is largely a matter of perspective.
Gardner and ITEP say the 21% corporate tax rate is too low. By comparison, the top tax rate for American workers is 37%.
Other groups say the old corporate tax rate, 35%, was too high.
The top corporate tax rate of 35%, in effect until 2017, "was the highest or third-highest in the world, depending on how you count it," said Kyle Pomerleau, senior fellow at the libertarian American Enterprise Institute. "Having a rate that is more in the middle of the pack at 21%, that’s good."
Advocates of lower corporate taxes say a lighter tax burden tends to boost productivity and hiring and can even increase tax revenue.
"The idea in the 2017 law was, can we make the United States more competitive?" said Garrett Watson, vice president of federal tax policy at the nonpartisan Tax Foundation. "And, can we encourage greater investment in the U.S. by bringing the corporate rate to a more competitive position?"
If the 706 companies included in the ITEP report had paid federal taxes at the old rate of 35%, the report found, they would have paid $657 billion in taxes in 2025.
Had they paid 21% of profits as tax, the lower rate approved by Congress under Trump, they would have paid $394 billion in taxes.
In fact, ITEP reports the companies collectively paid an estimated $196 billion in federal income taxes on $1.88 trillion in profits, which is an effective tax rate of 10.4%.
The report, published regularly by ITEP since the 1980s, draws tax data from corporate financial reports. Some companies did not report enough income or tax data to be included.
Big-name companies got big tax breaks in 2025
Most of the biggest tax breaks reported by ITEP went to the nation’s largest corporations:
- Alphabet, the parent company of Google, reaped $19 billion in tax breaks in 2025.
- Microsoft took $18.7 billion in tax breaks.
- Amazon got $17.5 billion in tax breaks.
- Meta reported $13.9 billion in tax breaks.
The biggest type of tax break leveraged by large corporations in 2025, ITEP says, was "accelerated depreciation."
Tax cuts enacted by Trump and Congress in 2017 "vastly expanded" accelerated depreciation, a tax strategy that allows companies to deduct the cost of capital expenditures much more quickly than tax rules normally allow, ITEP says.
Under accelerated depreciation, a corporation can build factories and purchase equipment and then write off the costs in a single year, rather than over many years. That strategy can reduce a company’s taxable income to zero.
"That is a big, big part of the low tax rates we’re seeing," Gardner said. "These tax breaks accumulate in a way that allows companies to pay very little indefinitely."
But accelerated depreciation only postpones taxes: If a company writes off an expense one year, it can’t claim the same write-off the next year.
"Deductions taken today can’t be taken tomorrow," Watson said.
By examining only one tax year, Pomerleau and Watson said, the ITEP report only provides a snapshot of each company’s taxes, and not a very revealing one.
"I would argue it doesn’t really tell us anything meaningful," Pomerleau said.
Fast-growing companies can use depreciation to write off some or all of their income, as long as they continue to build factories and buy equipment. But if they stop growing, their tax bill can shoot up.
Several companies included in the ITEP report had effective tax rates of 50% or higher in 2025. Two firms, Mohawk Industries and MKS Instruments, paid more tax than they collected in profit.
"It is more meaningful to look at the effective tax rate of a corporation over several years," Pomerleau said.
ITEP has published previous reports that looked at corporate tax rates over multiple years. In one 2024 analysis, the think tank found that the average tax rate for large, profitable companies dropped from 22% to 12.8% between 2013 and 2021 as a result of the Trump tax cuts.
This article originally appeared on USA TODAY: More than 100 big companies paid no federal income tax in 2025
