QI: Exxon Paid Almost $1M per Hour in Income Taxes and Its Effective Tax Rate Was 42.3%

ExxonMobil reported its first quarter 2011 earnings today, which came in at $10.65 billion, an increase of 69% from the same quarter last year when it earned $6.3 billion. While the huge earnings amount captured all of the media attention, several other items received much less attention (see chart above):

1. ExxonMobil paid $8 billion in income taxes to various governments in the first quarter, which is about $22 million in income taxes each day, or almost $1 million each hour.

2. ExxonMobil spent $7.8 billion in the first quarter on capital equipment and exploration, or more than $21 million per day, which is an increase of 14% compared to the first quarter last year. Over the next five years, the oil company plans to invest about $175 billion on capital equipment and exploration.

3. Compared to the first quarter last year, ExxonMobil increased its output of oil and natural gas by 10%, and a large part of that increased output came from a 192% increase in natural gas production in the United States, thanks to new advanced drilling technologies like hydraulic fracturing. While higher oil prices certainly played a major role in increasing Exxon's profits, the role of increased output shouldn't be ignored. And we shouldn't forget that retail natural gas prices in the United States, adjusted for inflation, are the lowest now since December 2002, in large part due to increased domestic production from companies like Exxon.

4. Dwarfing Exxon's first quarter profits of $10.65 billion, are the total taxes paid or collected around the world by Exxon from January to March, which total to$26.2 billion and include: a) $8 billion income taxes, b) $10.3 billion in sales-bases taxes, and c) $10.3 billion in all other taxes including property taxes, etc.

5. Exxon Mobil paid $8 billion in income taxes in the first quarter on $18.9 billion of income, which translates into a 42.3% effective income tax rate on its income. And yet according to Obama and others, oil companies "aren't paying their fair share of taxes," and should be taxed more?

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