America’s largest corporations have stashed nearly $1.5 trillion in offshore tax havens like Bermuda, the Cayman Islands, and Ireland — countries where they do little business but claim massive profits due to low tax rates.
As a result, corporate tax rates fell to a 40-year low in 2011 even as profits rose to a 60-year high. While the Republicans complain America has a high nominal corporate tax rate, they neglect the fact that the effective costs to those companies are very low.
Bank of America, General Electric and Facebook are among the many giant corporations that have made vast profits and yet paid zero federal income taxes.
Tax avoidance from corporations and wealthy individuals has a cost for individual taxpayers and small businesses, according to a new report from the U.S. Public Interest Research Group. According to U.S. PIRG, tax dodging cost individual taxpayers $1,026 and each small business $3,067 in 2012.
Those costs don’t necessarily come from higher taxes; instead, they often come in the form of higher budget deficits or, as they are now, from substantial cuts to public programs and services that benefit middle- and low-income families.
“This is a real loss and it’s putting great pressure on the budget and all kinds of investments and programs that the federal government needs to continue to fund,” said Democratic Sen. Carl Levin of Michigan on a conference call unveiling the report.
Levin has authored legislation calling for the closure of tax loopholes that reward the offshore exporting of profits.
“It’s time to close the loopholes, reduce the deficit to protect these important investments in our future, and to bring some fairness back to the tax code,” Levin said.
America’s largest corporations have stashed nearly $1.5 trillion in offshore tax havens, and as a result, tax dodging cost the average individual taxpayer $1,026 and each small business $3,067 in 2012.
Tax dodging corporations have cost you $1,026! It is about time that you did something about it.
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