The Financial Accountability and Corporate Transparency Coalition (FACT Coalition) sent a letter to Rep. Lloyd Doggett supporting H.R. 1931 which would help to curb corporate inversions. The full letter can be read below or downloaded here.
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May 17, 2017
The Honorable Lloyd Doggett
Ranking Member, Subcommittee on Tax Policy
United States House of Representatives
2307 Rayburn House Office Building
Washington, DC 20515
RE: Corporate EXIT Fairness Act (H.R.1931)
Dear Representative Doggett,
We write on behalf of the Financial Accountability and Corporate Transparency Coalition (FACT Coalition) to thank you for your leadership in introducing the Corporate EXIT Fairness Act of 2017 (H.R.1931), which would stop U.S. companies from claiming foreign residence simply to dodge taxes.
The FACT Coalition is a non-partisan alliance of more than 100 state, national, and international organizations working toward a fair tax system that addresses the challenges of a global economy and promoting policies to combat the harmful impacts of corrupt financial practices.[1]
A common theme from both Democrats and Republicans in the recent election was the increasing problem that multinational companies are moving money and jobs offshore. These practices are encouraged by loopholes in the tax code — loopholes that costs honest taxpayers an estimated $135 billion per year.[2]
The debate around tax reform should focus its attention on closing these loopholes. Unfortunately, some of the plans from Congress are likely to make matters worse by expanding the loopholes that got us into the mess we are in today. These plans are in direct contradiction with the clear message from the election that we certainly should not be subsidizing companies who move offshore.
Perhaps the most egregious tax loophole is one known as a corporate “inversion” whereby a large U.S. company buys up smaller, foreign companies, to move their legal residence to that country (a paper transaction, no moving van required) and claim they are no longer U.S. residents to avoid paying taxes. Under current law, these companies still have access to our markets and many of the privileges they enjoyed as U.S. companies, they just won’t pay for any of those privileges. That means middle-class Americans and domestic businesses are left paying their share of taxes.
The Corporate EXIT Fairness Act takes direct aim at these inversions, instituting a number of safeguards to protect honest taxpayers from this sort of gaming.
The reforms in H.R.1931 could and should garner bipartisan support, while offering more sensible and popular reforms than the radical alternatives that are dividing the Congress. That is why the FACT Coalition is proud to support the Corporate EXIT Fairness Act.
Thank you again for your leadership in protecting honest taxpayers from those who seek to shirk their civic responsibility. For more information, please feel free to contact Clark Gascoigne at cgascoigne@thefactcoalition.org.
Sincerely,
Executive Director
The FACT Coalition
Clark Gascoigne
Deputy Director
The FACT Coalition
cc: The Honorable Kevin Brady, Chairman, House Committee on Ways and Means
The Honorable Richard Neal, Ranking Member, House Committee on Ways and Means
The Honorable Peter Roskam, Chairman, Subcommittee on Tax Policy
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Footnotes:
- For a full list of FACT members, see: https://thefactcoalition.org/about/coalition-members-and-supporters/
- Merle, Renae. U.S. companies are saving $100 billion a year by shifting profits overseas, report says. The Washington Post. May 10, 2016. http://wpo.st/gIwp1 (accessed August 1, 2016).
About the FACT Coalition
The Financial Accountability and Corporate Transparency (FACT) Coalition is a non-partisan alliance of more than 100 state, national, and international organizations working toward a fair tax system that addresses the challenges of a global economy and promoting policies to combat the harmful impacts of corrupt financial practices.
1225 Eye St. NW, Suite 600 | Washington, DC | 20005 | USA
+1 (202) 827-6401 | @FACTCoalition | www.thefactcoalition.org