OECD’s Base Erosion and Profit Shifting (BEPS) Package “Important First Step” Towards Curtailing Abusive Tax Avoidance, but More Must Be Done
WASHINGTON, DC – As two congressional committees held hearings today on global efforts to tackle abusive corporate tax dodging, the Financial Accountability and Corporate Transparency (FACT) Coalition urged U.S. lawmakers to embrace the efforts, which target a practice gouging American taxpayers of roughly $90 billion per year.
“When corporations dodge their taxes, the public ends up paying,” said Clark Gascoigne, Deputy Director of the FACT Coalition, which unites over 100 leading small business, faith-based, human rights, anti-corruption, public-interest, government watchdog, labor, and global development organizations. “The American multinationals that shift their profits to tax havens use our roads, benefit from our education system and large consumer market, and enjoy the security we have here, but are ultimately taking a free ride at the expense of other taxpayers. It’s high time Congress takes a stand against multinational corporations that shift their profits offshore and avoid paying their fair share of taxes”
The U.S. Senate Finance Committee and the U.S. House Ways and Means Committee’s tax policy subcommittee held hearings Tuesday on the Organization for Economic Cooperation and Development’s (OECD) final package of proposals resulting from its (tax) Base Erosion and Profit Shifting (BEPS) project, which were published in October.
While abusive tax avoidance is a serious drain on the U.S. economy, the nature of the problem is truly global in scale. Global leaders from the world’s largest economies realized the pernicious effects of tax haven secrecy and abusive transfer pricing in the wake of the financial crisis. They recognized the importance of addressing the issue with a coordinated, global approach, and therefore commissioned the BEPS project to research and propose coordinated measures to globally curtail the damaging phenomena.
“Tax evasion and avoidance are a truly global scourge, undermining every economy from the United States and European Union to the poorest economies in Africa and Asia,” added Heather Lowe, Legal Counsel and Director of Government Affairs at Global Financial Integrity. “While the BEPS proposals are far from perfect, they are an important first step towards ensuring that multinational corporations pay all of the taxes that they owe in the places that they actually make their profits. They will be a huge boost to taxpayers in the U.S. and around the world.”
“All American businesses must pay their fair share of taxes. Most Main Street businesses do. It’s time that U.S. multinationals do as well, and the BEPS proposals would help to make that happen. Congress should consider the BEPS proposals as a source of ideas for tightening our tax code so that the government collects the tax revenue it needs to build and maintain essential services and infrastructure,” said Bryan McGannon, Director of Policy and Engagement for the American Sustainable Business Council.
“Despite what the lobbyists for the richest multinational corporations say, supporting and implementing the BEPS package is in the interest of the American people and our economy,” added Mr. Gascoigne of FACT.
A recent report from two of FACT’s members detailed the serious consequences of offshore tax haven abuse on U.S. taxpayers. Published in October by Citizens for Tax Justice and the U.S. Public Interest Research Group Education Fund (U.S. PIRG Ed. Fund), the study reveals that the nation’s largest multinational corporations dodge nearly $90 billion in U.S. taxes annually through the abuse of offshore tax haven loopholes, shifting the country’s tax burden onto small businesses and individual Americans.
Notes to Editors:
- Click here to read an HTML version of this press release on our website.
- Click here to read more about the BEPS proposals from the OECD.
- Click here to read the report from CTJ and U.S. PIRG.
Deputy Director, FACT Coalition
Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system. For more information, visit www.thefactcoalition.org