Monolithic corporations, like Pfizer, have cut their federal income taxes a lot. The share of federal revenue coming from corporate taxes has fallen from around 32 percent in 1952 to 8.9 percent now. As a share of gross domestic product, it has fallen from about 6 percent of GDP then to less than 2 percent now.
This is due largely to a process called inversion. Basically, a company buys or merges with a non-US company and claims to no longer be based in the US to get out of paying certain taxes. The company does, however, keep the same employees, executives, buildings, sales channels and customers it had inside the US before the switch.
This has worked quite well for Pfizer. Bloomberg reports “earnings before taxes outside the US were $15 billion in 2011 while losses within the country were $2.2 billion. … These operating results appear to be inconsistent with [Pfizer's] domestic and international revenues, which in 2011 were $26.9 billion and $40.5 billion, respectively.”
In addition to inversion, companies need not repatriate profits held overseas. Again, the money adds up; Pfizer held as much as $73 billion of taxable profits outside the US in 2012.
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