IPG Has Paid Income Taxes The Past Five Years

Here’s the response from the company to our IPG tax item that ran in the last column:

“IPG pays income taxes all over the world. In 2013 alone, IPG paid $21 million in U.S. income tax to state and local governments. Also in 2013, we paid $91 million in income tax outside the U.S. – so we paid $112 million in income taxes just last year. And over the last five years, IPG has paid approx. $400 million in income taxes, and significantly more if you include the individual, employee and VAT taxes we also pay in the markets where we operate. 

   “We are an extremely responsible tax citizen of the world and our 2013 effective tax rate of 39% is higher than our peer group – Omnicom’s hovers around 34%. The fact our tax rate is higher than our peers is not necessarily a good thing, but to call us out without doing any research about our peer group is not cool… For the specific band of U.S. federal tax purposes – which is the data the Institute on Taxation and Economic Policy covers – IPG has a tax loss from 2004 to 2006, which has been carried forward (U.S. tax law permits losses to be carried forward for 20 years) to offset taxes in the past number of years – hence we do not pay U.S. federal income tax. 

   “I don’t think that warrants a blanket comment like ‘Yup, that big ass agency holding company headed by Michael Roth. And we wonder why people perceive advertising professionals as highly as car dealers.’ Especially when our effective tax rate is 39%, and when we paid $400 million in income tax over the past five years, and significantly more if you include all the other tax buckets. The headline is flat-out wrong. You could correct it by saying ‘IPG Paid No U.S. Federal Income Tax,’ but even then, I don’t think the post is fair, based on the above.”

   Points well taken for the most part, although we tend to be somewhat snarky and that won’t stop. But now you have the facts on IPG’s tax-paying status straight from the horse’s mouth so to speak.   

In an effort to celebrate the often time stellar work agencies do for non-profits and other causes, ACT Responsible, in partnership with the Gunn Report, is launching The Good Report, an annual collection and celebration of innovative cause-related campaigns. The Good Report honors the Top 30 Campaigns for Good, the Top 20 Agencies, the Top 10 Networks and the Top 5 advertisers. 

You've probably heard the "agencies must change or die" mantra before. It rears its head about every three years or so. Its latest incarnation involves the gyrations and machinations holding companies must go through to streamline the cobbling together of disparate services into one cohesive offering that can serve the wildly varying needs of today's brands. Mixpo CEO Jeff Lanctot, an agency veteran thinks he has some direction and has shared his ideas is a Wall Street Journal piece. His four points cover the need for agencies to master un-siloed mult-screen, multi-channel planning, to offer managed services through partnership with software companies rather than competing with them, to eliminate the games played when it comes to the buying and reselling of media and, unsurprisingly, a collection of expertise that's relevant to the ever changing needs of today's brands.

Bonfire Labs, a growing content marketing agency, has made three new hires. The agency has brought in former Google Brand Studio executive producer and Goodby, Silverstein & Partners producer Tim Pries as executive producer. Also joining the agency as producer is John Hunt, former live action producer on Discovery Channels' MythBusters and Judy Leung, formerly with Hyphen magazine, will join as designer. Of the hires, Bonfire Labs Managing Director Jim Bartel said, “We are pleased to add these uniquely talented individuals to the roster of talent already at Bonfire Labs. Each of them will make a valuable contribution as we continue to leverage our unique position in the industry.”

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