White House questioned about Immelt appointment after tax expose

The White House on Friday faced questions about its decision to appoint GE head Jeffrey Immelt to lead up the President's Council on Jobs and Competiveness after a New York Times story claimed GE was able to avoid taxes for its 2010 earnings.

White House spokesman Jay Carney was asked “if in the name of competitiveness and job creation the president feels we have to address our corporate tax structure, why appoint to the head of the competitiveness and jobs council a person who is now the poster child for using the system to get out of paying taxes?”

Carney replied “the president obviously doesn't want a council of people who agree with him on every issue; he wants to hear diversity of opinion.”

While declining to speak to GE’s finances, he said President Obama is bothered by abuse of the corporate tax code and favors tax reform.

Obama is “bothered by what I think you're getting at, which is that Americans, I'm sure, who read that story or heard about it are wondering, you know — you know, how this could be,” Carney said.

He said “not addressing a specific company, because I don't know independently about that, but it is part of the problem of the corporate tax structure that companies hire, you know, armies of tax lawyers to understand how it works and to take advantage of the various loopholes that exist, that are legal, in order to reduce their tax burden.”

The New York Times reported that GE reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States, even though it paid no U.S. taxes.

GE went on a public relations offensive Friday and said the Times story “presents a particularly distorted and misleading account of GE tax payments.” Among other things, it claimed that if GE Capital is taken out of the equation, the effective tax rate on GE was 21 percent in 2010. It also claimed GE paid $2.7 billion in taxes on a consolidated basis.