FACT Welcomes Reintroduction of Legislation to Shine a Light on Corporate Tax Dodging Practices

Bill Would Require Public Country-by-Country Reporting for Multinationals

WASHINGTON, DC – The Financial Accountability and Corporate Transparency (FACT) Coalition today welcomed the reintroduction of the Disclosure of Tax Havens and Offshoring Act (DTHOA) by Senator Van Hollen (D-MD), alongside ten original cosponsors. Endorsed during the last Congress by over 150 nonprofit organizations, small business groups, and investment professionals, the DTHOA would shine a light on the abuse of offshore tax havens and provide much-needed information to investors, regulators, and journalists by requiring multinational corporations to publicly report overseas tax and operational data on a country-by-country basis.

“FACT applauds Senator Van Hollen and his colleagues for reintroducing this vital tax transparency legislation,” said Ian Gary, executive director of the FACT Coalition. “We’ve seen an avalanche of international and domestic momentum over the past year for public country-by-country reporting (PCbCR). This has made it clear that the question is not whether large corporations are going to have to start reporting this information, but when.”

Since the legislation was last introduced to Congress in 2021, support for PCbCR has continued to gain traction among a diverse set of constituencies. Investors, in particular, have made their demand for PCbCR data increasingly clear, with shareholder resolutions calling for disaggregated reporting of tax and operational data from major multinationals Amazon, Microsoft, Cisco, Exxon Mobil, Chevron, and ConocoPhillips all being advanced over the past year. Last year also saw two U.S.-based oil and mining companies, Hess and Newmont, become the first large American multinationals to voluntarily publish country-by-country tax data in line with international best-practices.

The demand for this information among investors is based in concrete need: without access to country-by-country tax data, investors are left without the tools necessary to determine exactly where and how these companies are doing business, and are consequently exposed to unknown risks posed by international and domestic tax reforms, geopolitical developments, and supply-chain disruptions.

“A trillion dollars of corporate profits are shifted to the murky world of tax havens every year, driving inequality and leaving ordinary people to pick up the tab,” said Nabil Ahmed, Economic Justice Director at Oxfam America. “Investors need this basic financial information to determine whether a company is profitable thanks to a successful business model, or whether impressive profit margins are being built on unsustainable patterns of tax avoidance. If the SEC won’t move to require more transparency from US multinational corporations, then Congress should take the initiative by passing this bill.”

While investors worth trillions of dollars in assets under management and policymakers clamor for this data, the U.S. is falling behind international trends, with a limited PCBCR EU law already in place and Australia set to advance its own PCbCR proposal this year. Australia’s proposal is broad enough to potentially impact certain U.S.-headquartered multinationals, and represents the most complete PCbCR proposal yet introduced in any major jurisdiction.

FACT has long argued that the Securities and Exchange Commission (SEC) should use its existing authority to mandate PCbCR in light of these mounting pressures and international trends. Major multinationals already privately report data including profits, related and third-party revenue, taxes paid, employment figures, and tangible assets about their overseas operations on a country-by-country basis to the IRS, making reporting burdens from any new SEC mandate negligible.

“It is long past time that investors, investigators, and policymakers be given access to this vital data,” said Gary. “While FACT and our allies continue to advocate for SEC action on PCbCR, Congress has an opportunity to advance these critical transparency reforms by passing this legislation this year. ”

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Notes to the Editor:

Click here to read the text of the Disclosure of Tax Havens and Offshoring Act as introduced in the U.S. Senate.
Click here to read Senator Van Hollen’s Press Release on reintroduction of the DTHOA.
Read the latest FACT Sheet detailing the need for the SEC to require PCbCR from large multinationals here.
Investors representing over $2.9 trillion in assets under management supported the Disclosure of Tax Havens and Offshoring Act during the 117th Congress.
The Disclosure of Tax Havens and Offshoring Act was introduced by Senator Van Hollen alongside Senators Durbin, Sanders, Smith, Whitehouse, Klobuchar, Casey, Blumenthal , Baldwin, Duckworth, and Warren.