【By Chen Sijia, Observer News】According to a report by the U.S. "New York Times" on August 15, internal company documents show that since its establishment in 2002, SpaceX, an American aerospace company, has received billions of dollars in federal contracts, but may have paid almost no federal income tax. The company also privately told investors that it might "never need to pay these taxes" in the future.

The company, founded by U.S. billionaire Elon Musk, is not publicly listed and therefore its financial status remains confidential. However, documents obtained by the "New York Times" indicate that as of the end of 2021, SpaceX had accumulated nearly $5.4 billion in tax losses, which can be used to avoid paying federal income tax to the U.S. government through tax incentives including loss carryforwards.

As an American private space company dedicated to reaching Mars, SpaceX has spent a lot of money since its establishment. In the first year of operation (2002), SpaceX lost about $4 million. The following year, it lost $14.5 million. In the subsequent years, losses continued to increase, reaching $341 million in 2020. In 2021, the company lost $968 million.

The report stated that tax loss carryforwards allow companies to offset corresponding federal income tax when they have equivalent taxable income in the future, and this benefit applies to all U.S. companies. President Trump signed a comprehensive tax cut policy during his first term, which eliminated the 20-year limit on tax loss carryforwards, meaning that SpaceX can indefinitely carry forward its losses to subsequent tax years.

In addition, the documents showed that SpaceX also has $227 million in losses available to offset state income tax and has $1.1 billion in other federal and state tax credits.

SpaceX's Starship spacecraft, Visual China

The "New York Times" said that from these documents, it is clear that SpaceX did pay some income tax, but it is likely that it did not pay it to the U.S. federal government. For example, one document disclosed that in 2021, SpaceX expected to pay $483,000 in income tax to foreign governments and $78,000 in income tax to state governments. The documents reported that in 2020 and 2021, it additionally paid $6,000 in income tax, but did not specify the recipient.

Some documents also showed that SpaceX had told investors that due to past losses and other factors, the company "may not use part or all of the deferred tax assets," meaning that it "may never need to pay the relevant taxes."

American tax experts said that SpaceX has received a large number of contracts from the U.S. federal government, works closely with the U.S. Department of Defense, NASA, and other agencies, yet it can avoid paying federal income tax, and this revelation is worth attention.

Gregg Polsky, a tax law expert at the New York University School of Law, said, "Given the scale of its net operating losses, it is almost certain that the company has not paid any federal tax for many years. Due to the huge size, even if it has positive taxable income in recent years, it is unlikely to pay taxes."

The report pointed out that larger tech companies in the United States, including some that can enjoy tax incentives, usually pay billions of dollars in taxes. For example, Microsoft previously revealed that it expects to pay $14.1 billion in federal income tax for the previous fiscal year.

Since its establishment, SpaceX has signed hundreds of contracts with U.S. federal agencies, including contracts to deliver cargo to the International Space Station with NASA, and contracts with U.S. intelligence agencies for spy satellites. Some of these contracts can generate considerable income over several years.

The "New York Times" cited data from relevant documents, stating that in 2020, federal contracts generated $1.4 billion in revenue for SpaceX, accounting for 83.8% of the company's total revenue that year. In 2021, federal contracts brought in $1.7 billion for the company, accounting for 76% of its total revenue that year.

Danielle Brian, executive director of the non-profit organization "Project On Government Oversight," which investigates corruption, said that tax incentives are intended to encourage companies to continue operating during difficult times, and that SpaceX using this policy is "odd," "because it obviously is not designed for a company that is doing so well."

Musk said in June this year that he expects SpaceX's revenue this year to reach $15.5 billion, and that the company's commercial space revenue "is expected to exceed NASA's total budget next year." SpaceX said that the rapid growth in revenue is largely due to the "Starlink" satellite internet service, which has grown to about 6 million users.

This article is exclusive to Observer News. Reproduction without permission is prohibited.

Original: https://www.toutiao.com/article/7539071534267122216/

Statement: This article represents the views of the author. Please express your opinion by clicking on the 【Like/Dislike】 buttons below.