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Study Highlights How Rigged Tax Code Hurts Small Business, Middle Class Americans

Multinational Companies Dodging $147 Billion Annually in State and Federal Taxes through Offshore Tax Schemes
WASHINGTON, D.C. – A new report from U.S. PIRG Education Fund finds that multinational companies dodge an estimated $147 billion in federal and state taxes annually through offshore tax haven loopholes.  The report explains the staggering cost to small businesses and individual taxpayers, who are forced to shoulder the increased tax burden.

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Just the FACTs: November 28, 2016

Increasingly the issues of tax avoidance and financial secrecy are drawing the attention of a broader audience.  Both issues were repeatedly mentioned throughout the presidential election by both candidates.  Donald Trump’s original tax plan even went as far as to end deferral, though updates to the plan in September omitted any position on it.  With the results of the election in, FACT and our members are analyzing what they mean for reform here at home.  More on that in the weeks to come.

The EU commission’s decision in August to force Apple to pay back $14 billion in dodged taxes to Ireland served as a wake-up call to many investors—tax avoidance is a serious risk.  A recent article in the Financial Times, explained how several major funds and investment groups are deeply concerned with companies’ increasing reliance on tax avoidance schemes.  One such fund, Nordea Asset Management—has written to a number of companies—including Alphabet and Apple.  In the letter, they ask that companies lay out their tax risks and that—if they don’t comply by January—they “will rally other investors and propose shareholder resolutions in 2017.”  Four other fund houses in the UK—representing almost £1tn of assets—have also written to the board of Alphabet to raise concerns about its tax arrangements.

 

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Just the FACTs: October 18, 2016

There’s been a lot of talk recently about how the tax system is rigged.  More and more we are seeing that wealthy individuals and powerful multinational companies are able to play by their own set of rules.  According to a new report by FACT members Citizens for Tax Justice (CTJ), the Institute on Taxation and Economic Policy (ITEP), and U.S. PIRG, Fortune 500 companies are now holding $2.5 trillion offshore. By shifting their profits to tax havens, these U.S. companies have been able to avoid $718 billion in taxes. The legal loopholes that allow these companies to avoid their taxes are simply unavailable to average taxpayers and small businesses, who can’t afford to hire the lawyers and accountants to move money through shell companies created in tax havens.

The U.S. Treasury Department took a modest step toward countering corporate tax avoidance Thursday night by issuing a new rule aimed at preventing a tax dodging technique known as “earnings stripping.” While FACT members are still in the process of reviewing the 518-page measure, the rule is estimated to close about $600 million per year in offshore tax avoidance loopholes.

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Treasury Department

Coalition Welcomes Rule to Stem Multinational Corporate Tax Avoidance

Treasury Finalizes Anti-Inversion Rules Tackling “Earnings Stripping”
WASHINGTON, D.C. – The U.S. Department of the Treasury finalized a long-awaited rule Thursday aimed at countering multinational tax avoidance, in a move welcomed by the Financial Accountability and Corporate Transparency Coalition (FACT Coalition).

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Tax Notes Op-Ed: What Apple Teaches About How Not to Reform Corporate Taxes

In this article—originally published in Tax Notes—FACT Executive Director Gary Kalman uses the recent Apple tax ruling by the European Commission to identify problems with proposals for a territorial tax system in the United States. He argues that policymakers should instead focus on ending deferral, requiring public country-by-country reporting, and adopting provisions of the Stop Tax Haven Abuse Act.

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New Report: Multinationals Dodging $718bn in U.S. Taxes on Profits Booked Offshore

New Analysis Underscores Need to End Deferral, Boost Transparency of Companies’ Offshore Tax Practices
WASHINGTON, D.C. – The largest American companies have stashed nearly $2.5 trillion in profits offshore allowing them to dodge $718 billion in U.S. taxes, according to a new report released Tuesday by Citizens for Tax Justice (CTJ), the Institute on Taxation and Economic Policy (ITEP), and the U.S. Public Interest Research Group (PIRG) Education Fund—all members of the Financial Accountability and Corporate Transparency Coalition (FACT Coalition).

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