By Tim McLaughlin

(Reuters) - Exxon Mobil’s income tax payments to the U.S. government have dropped to 3% over the past five years – several times below the company’s 20-year average – on massive deductions passed under former President Donald Trump.

Corporate tax experts say Exxon could enjoy low taxes for several more years, at a time when the government needs more money to fund an ambitious fight against climate change. President Joe Biden’s minimum corporate tax is off to a shaky start and calculation of the 15% tax factors in the Trump accelerated depreciation deductions that Exxon used last year. That lowered its tax rate to a rock-bottom 2.5% on domestic profit of $28.3 billion.

“If you view the use of these tax breaks as a problem, Biden’s new minimum tax is unlikely to end that,” said Matt Gardner, a senior fellow at the nonpartisan Institute on Taxation of Economic Policy (ITEP) in Washington D.C.

In sharp contrast, the most valuable companies representing major sectors of the U.S. economy paid an average tax rate on domestic profits at least seven times higher than Exxon, according to a Reuters analysis of the companies' latest annual financial reports. The group includes Apple, Meta Platforms, JPMorgan Chase, Sherwin-Williams and Union Pacific.

Exxon’s recent tax advantage reveals how the U.S. tax code hinders the Biden administration’s push to be a world leader in limiting fossil fuels. The corporate minimum tax is the main source of revenue for the president’s green energy agenda in the 2022 Inflation Reduction Act.

The Internal Revenue Service (IRS), however, has delayed a roll out of the tax, which has been roiled by complexity and confusion, said Will McBride, vice president of tax policy at the Tax Foundation, a pro-business think tank.

“There is nothing in the (corporate minimum tax) to guarantee a 15% minimum rate,” McBride said.

The White House declined to comment for this story, but a spokesperson pointed to Biden's public commitment to end "tens of billions of dollars of federal tax subsidies for oil and gas companies."