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With Congress Scrambling to Make Ends Meet, Closing Tax Loopholes on the Table
For Immediate Release
Thursday, April 15, 2010
While a lot of attention is given on Tax Day to how tax dollars are spent, one watchdog group is instead focused on the revenue lost every year – $100 billion – thanks to loopholes, tax avoidance and tax cheats.
Each year, major corporations and individuals avoid as much as $100 billion a year in federal taxes by “off-shoring” the money they make here in the U.S. or by setting up sham headquarters in tax haven countries. Taxpayers are left footing the bill.
According to Tax Shell Game: What Do Tax Dodgers Cost You? a new MASSPIRG report, this results in an average of $500 in additional tax burden for taxpayers. Here in Massachusetts it is $697 per taxpayer.
As Congress scrambles to pay for a number of tax cuts, tax breaks and new programs, they may finally take a serious look at corporate loopholes and tax avoidance.
Senator Carl Levin (D-MI), who sponsors the Stop Tax Haven Abuse Act in the Senate, and Chairs the Permanent Subcommittee on Investigations, said: “The United States cannot afford to let offshore tax cheats continue to rob the U.S. Treasury of billions of dollars each year that are needed to support education, health, defense and other needs. While Congress enacted a strong new law this year that will help tackle the offshore problem, more can and should be done to make sure everyone pays their fair share.”
Nearly two-thirds of both U.S.-controlled and foreign-controlled corporations pay no taxes at all. Companies that use tax haven countries include American Express, A.I.G, Exxon Mobil, Goldman Sachs and Pfizer – all of which were either recipients of taxpayer-funded bailout money or receive lucrative government contracts.
“Tax haven abuse harms American competitiveness and raises the tax burden on honest taxpayers, including small businesses, who play by the rules. We should shut the tax loopholes that encourage corporations to ship their profits and American jobs offshore. A level playing field requires all to contribute their fair share and restoring fiscal discipline demands it,” added Representative Lloyd Doggett (D-TX), the House bill’s sponsor and member of the powerful Ways and Means Committee.
“Today should be the last Tax Day when high-priced accountants and secret post office boxes are valued over hard work and accountability,” said Deirdre Cummings, MASSPIRG’s legislative director.
“All taxpayers, including big businesses, rely on public infrastructure and services including education, transportation, public safety, parks and recreation, and public health. And whatever your perspective on the level of taxes, most everyone agrees that our taxes should be fair. Small businesses and ordinary taxpayers should not have to pay more because some banks and big corporations take advantage of elaborate schemes and tax havens, concluded Cummings.
To read Tax Shell Game, click here.
To learn more about the companies who lobby against reforms, read U.S. PIRG's report, Who Slows the Pace of Tax Reform.
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Some Massachusetts tax payers have until May 11 to file their taxes, after their counties were declared “federal disaster areas” due to last month’s floods. Click here for more information.
MASSPIRG is a member supported non-partisan and non-profit public interest advocacy group in Massachusetts. U.S. PIRG ,is the federation of state Public Interest Research Groups, and is also non-profit and non-partisan.
For more information on U.S. PIRG’s campaign to Close Corporate Tax Loopholes, click here.
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