[Carnival] has paid total corporate taxes—federal, state, local, and foreign—equal to only 1.1 percent of its cumulative $11.3 billion in profits.” The company is able to do this because its ships are legally registered in Panama, allowing the firm to shelter its profits there, though it also pays very little in Panamanian taxes.21
Carnival spends a tremendous amount of money trying to influence policymakers in order to protect its lucrative tax position. Over the last ten years the company’s PAC and employees have given $1.7 million in federal campaign contributions, with $131,099 of that going to members of the House Ways and Means Committee and another $100,300 to members of the Senate Finance Committee. The company also spent $1.6 million on lobbying expenditures during that period.
Quick Facts on Carnival
Campaign Contributions: Total Over 10 Years (2001-2010), $1.7 million
Lobbying Expenditures: Total Over 10 Years (2001-2010), $1.6 million
Profits over Last 5 Years: $11.3 billion
Taxes Paid for Last 5 Years: 1.1 percent
Yet, when asked about Carnival’s failure to pay their fair share of taxes, Arison claimed, numerous times, that they “paid $400 million in taxes and fees world wide.” I really wanted someone to ask what they paid here in the US!
My favorite question came from a man who didn’t give his name. He identified himself as a shareholder, and thanked the board for “having us.” He continued to thank them for their good work, and “making this such a tremendously profitable corporation, the most profitable corporation here in Miami-Dade County.”
As there was a smattering of people who got up to the mic and delighted in saying that they held 900 or 1000 shares – and were quite peeved at the lowly one-share holders for invading their inner sanctum, I was pretty convinced he was one of them.
He continued, “My question regards how we are responding to the loss of public trust over the recent disaster, and whether we thought of one idea that I had that really hasn’t been kicked around by our experts. What if we just (pause) pay our fair share in taxes, and make a big deal about it, because not many other people do? In the last three years, we made 5.6 billion in profits, and avoided about 1.2 billion in taxes. We paid more for lobbyists than we did in taxes, and that’s pretty common practice, it’s not just us.”
At that point, Micky Arison cut in and said “Regardless of how many times I say 400 million, you’re just going to ignore what I say, right?” To which the questioner responded, “Exactly.”
Arison threw out some more nonsense, and someone shouted out the question I had been waiting for, “How much taxes did you pay in the United States?” His response: “If you want to see what the industry pays in the US and the economic impact, look at the CLIA website…” (Note: I did. The information isn’t there. Regardless, the question wasn’t about the industry! It was about Carnival.)
Then came what I considered the threat. Arison basically said that if they paid their fair share of taxes, Florida would suffer. His exact quote was “The reality is that if you want to make Florida uncompetitive globally, in shipping or in the cruise industry, it’ll cost Florida tens of thousands of jobs and hundreds of millions of dollars. This is a global economy, this is a global industry” blah blah blah….
Not being one know to hold her tongue, I had enough. I stood up and got in line. Unfortunately, I forgot to check the recorder in my purse, because it shut off before I took the mic.
But to the best of my recollection, when my turn came, I began by explaining that I, too, am a shareholder. I said I wasn’t planning on asking a question, but listening to what had transpired thus far sparked a few.
The power-point presentation at the top went to great lengths to show the safety measures instituted since the Costa Concordia disaster in Italy (and the big losses suffered by Carnival as a result). I said that from all the accounts I had read, it was a cocky captain who was showing off by taking the ship too close to land. Arison basically said that they had safety regulations, the crew was top notch and knew what it was doing, but the media blew it all out of proportion.
Earlier in the session, he had remarked that “only” five of their ships were based at the Port of Miami. I asked where those ships were registered. I believe he harrumphed a few times, pleaded ignorance, and turned to the board members, who told him Panama and somewhere else.. I asked “Why not here?” and he harrumphed some more. Someone in the audience shouted out “too expensive” and I asked him if that was it.
He then went on to say something about how not only could they not register the ships here, they can’t build them here either! To which I asked, shocked, “You don’t build them here?” And as he tried to explain why, all I heard was him saying American ship building expertise doesn’t exist. Wow.
But I wasn’t done. There was that question bugging me that he still didn’t answer. “Mr. Arison,” I said. “You keep mentioning that Carnival paid $400 million in taxes and fees worldwide. What did you pay in US corporate income tax? The last time I checked, it was 35%. Did you pay 35%?”
He replied that Carnival is not a US corporation. I asked him “then why are you here?” and he went back into his threat about what would happen to Florida if they took their non-tax-paying asses and left.
At the same time, some pissed-off looking guy came and took away the microphone, and the people in the room began quietly chanting, “Pay your fair share, Pay your fair share.” A few dozen got up, chanting even louder, while exiting the room.
I decided to stay a bit longer to see what Arison would say after they left. It was pretty much what I expected… “They’re doing more harm than good. It’s part of the occupy movement. In New York, it’s called Occupy Wall Street. Here, it’s 1Miami. It’s a free country. Everyone is entitled to buy a share.”
The next guy in line began by proclaiming that he owns 1000 shares of Carnival, and travels with them frequently. He complained that at the end of every trip, there are comment cards asking for their favorite thing about the cruise, but no place to complain. He wanted them to know that he wants deli mustard in the deli instead of the yellow kind.