FACT Coalition Submits Comments to the U.S. Department of the Treasury and the Internal Revenue Service on Proposed Country-by-Country Reporting Rule
WASHINGTON, DC – The Financial Accountability and Corporate Transparency Coalition (or FACT Coalition) submitted comments to the U.S. Department of the Treasury and the Internal Revenue Service today offering strong support for—and recommending measures to further strengthen and clarify—a proposed rule to crack down on abusive tax avoidance by multinational corporations.
By artificially shifting profits from the U.S. to offshore tax havens with low or no corporate tax rates, multinational corporations are able to dodge up to $111 billion per year, according to a recent academic study. The proposed rules—known as Country-by-Country Reporting (or CbCR)—would help tax authorities detect these abusive tax practices by requiring multinationals to report their revenues, profits, taxes paid, and employee levels on a country-by-country basis.
“We wholeheartedly welcome this anti-tax dodging proposal,” said Clark Gascoigne, Interim Director of the FACT Coalition, which unites over 100 leading small business, faith-based, human rights, investor, anti-corruption, public-interest, government watchdog, labor, and global development organizations from across the ideological spectrum. “When multinationals avoid paying taxes by manipulating their tax bills, small businesses and average American taxpayers have to pick up the bill in the form of cuts to public programs, higher taxes, or more debt. Requiring corporations to disclose where they are operating, where they are making their profits, and where they are paying taxes is a common-sense approach to detect and deter corporate tax dodging.”
Need for Public CbCR
While a strong first step, the proposed measure—as it is currently written—would classify CbC Reports as confidential to the IRS, making it nearly impossible for lawmakers, law enforcement, and their equivalents in other countries to have access to information needed to develop solutions to this global revenue crisis. The FACT Coalition urges the administration to make the CBCR information available to the public.
“It makes no sense to restrict access to this information exclusively to the IRS,” said Heather Lowe, Legal Counsel and Director of Government Affairs at Global Financial Integrity. “Aggressive profit-shifting is a global problem that needs legislative solutions, and we need to give every willing person the opportunity to analyze the data and identify solutions, not just the IRS.”
Notes to Editors:
- Click here to read an HTML version of this press release on our website.
- Click here [PDF] to download FACT’s comments submitted to the Department of the Treasury and Internal Revenue Service.
- Click here to read the proposed rule on Regulations.gov.
Interim Director, FACT Coalition