Berkshire Hathaway chairman Warren Buffett seen at Berkshire’s annual stockholder shopping day in Omaha, Nebraska, US, May 3, 2019.
Scott Morgan | Reuters
Researchers applied the Inflation Reduction Act’s new 15% corporate tax to 2021 corporate profits and found that the burden would only be felt by about 78 companies, with Berkshire Hathaway and Amazon paying the most.
The study from the University of North Carolina Tax Center used past securities returns to map the tax, which takes effect in January, on corporate earnings in 2021.
The researchers found that the 15% minimum by 2021 would have taken a total of $31.8 billion from 78 companies. Berkshire led the estimated payout with $8.33 billion, and Amazon follows with $2.77 billion owed based on its 2021 revenue.
The study points out the limitations of only looking at data from public companies within one year. The researchers acknowledged that these estimates could be subject to change, especially as business operations change under the load in 2023.
President Joe Biden signed the minimum book tax in August along with the rest of the Inflation Reduction Act. The tax is specifically aimed at companies that make more than $1 billion a year.
The Joint Tax Commission had previously estimated that it would affect about 150 companies, with the costs falling specifically on the processing industry. The bipartisan JCT also forecast $34 billion in revenue in the first year of the tax, slightly more than the theoretical 2021 revenue estimated by UNC.
According to the study, Ford, AT&T, eBay and Moderna would pay the second-highest taxes, all of which would have to pay more than $1.2 billion in payments based on their 2021 financial data.