April 25, 2012 / 3:25 PM / in 7 years

GE annual meeting interrupted by 99 Percent protesters

* Several hundred assemble outside meeting

* “We pay our taxes,” says GE CFO

By Scott Malone

DETROIT, April 25 (Reuters) - Nearly 100 protesters affiliated with the “99 Percent” populist movement disrupted the start of General Electric Co’s annual shareholders’ meeting on Wednesday, in an attack on the largest U.S. conglomerate’s low tax rate.

The demonstrators were quickly ushered out of the meeting - held in the Detroit building that houses General Motors Co’s headquarters - but could still be heard chanting protests as the meeting got underway.

After their exit, Chief Financial Officer Keith Sherin stepped up to defend GE’s tax practices.

“We absolutely are compliant with every law around the world in how we pay our taxes,” Sherin said. “Our U.S. tax expense last year was $2.6 billion. We are a large taxpayer, we pay our taxes and we very much support tax reform.”

The protesters complaints were linked to GE’s low 2010 and 2009 tax rates, which the company says were a result of heavy losses at its GE Capital arm during the financial crisis. A 2011 report by left-leaning think tank Citizens for Tax Justice claimed GE had an effective negative tax rate from 2008 through 2010, which the company has repeatedly denied.

The “99 Percent” movement is an offshoot of last year’s Occupy Wall Street protests, and both are loosely organized around the idea that the U.S. economy no longer serves the needs of most Americans. The “99 Percent” moniker contrasts the average citizen to the nation’s wealthiest.

A few hundred people affiliated with the movement carried signs outside the meeting which read “Tax Dodgers at Work” and “This is What Democracy Looks Like.”

Jeff Immelt, the company’s chief executive, told reporters ahead of the meeting that GE supports the idea of reforming the U.S. tax code and that its low tax rate in 2010 and 2009 reflected heavy write-offs at its GE Capital arm during the financial crisis.

“We are in favor of tax reform, we have said that,” Immelt said. “Our tax rate in 2011 was 29 percent, just as we said it was going to be. You had some big financial services write-offs in 2009 and 2010, but out tax rate was 29 percent last year.”

Protester Shyquetta McElroy, 22, a mother of two from Milwaukee, Wisconsin, said she wanted to call attention to the effect that low corporate taxes were having on average Americans such as her family, which lost its health insurance after she lost her job.

“We’re being kicked off so big companies like GE can get tax cuts,” McElroy said outside the meeting.

Separately, a smaller group of a few dozen GE retirees, a fixture at its traveling shareholder meetings, picketed in front of the building to ask for higher pensions. One of them, Earl Horning a 66-year-old retiree from GE’s appliance arm, said the tax issue wasn’t his focus.

“I’m someone who focuses on things I can change,” Horning said. Corporate taxes are “not something I can do anything about.”

A day earlier, police in San Francisco arrested two dozen people affiliated with the 99 Percent movement who sought to disrupt a Wells Fargo & Co meeting to express anger over foreclosures, executive compensation and corporate taxes.

GE disclosed in filings with the U.S. Securities and Exchange Commission that its overall tax rate - on both foreign and U.S. earnings - was 7 percent in 2010 and negative 12 percent in 2009. It has not provided details about its U.S.-specific tax rates for prior years.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below