Close Corporate Tax Loopholes

Across the country, some of the nation’s most prosperous people and companies — including GE, Google and Goldman Sachs — have avoided paying the taxes they owe, costing taxpayers $150 billion just last year.

TAX HAVENS COST US $150 BILLION A YEAR

No company should be able to game the tax system to avoid paying what it legitimately owes. And, yet, with atleast 83 of the nation's top 100 publicly traded companies establishing shell companies in offshore havens to avoid taxes, this is becoming more the rule than the exception. GE, Google, Goldman Sachs and dozens of others have created hundreds of phantom entities with nothing more than a clever tax attorney and P.O. box. 

Most recent academic studies estimate that about $150 billion in tax revenue is lost every year to offshore tax havens. The result? Cuts to public services, additional taxes today or additional debt to be paid by the next generation. 

It’s not illegal, but it’s not right.

Meanwhile . . . the average taxpayer paid $1,026 more to cover the billions that GE and others skipped out on last year, companies that don’t use these schemes keep struggling to compete with those that do, and state legislatures and Congress are considering deep cuts for essential public programs — from education, to health care, to clean air and drinking water.

We're being asked to tighten our belts and make sacrifices while giving the tax haven crew a free ride. U.S. PIRG is pushing for commonsense changes that simply say that if corporations are based here and generate profits here, then they should, like all of us who earn income here, pay the taxes they owe.

Issue updates

News Release | U.S. PIRG | Budget, Tax

Offshore Loophole Got Snuck Back in Tax Extenders Bill Behind Closed Doors

After Chairman Wyden took the bold step of striking an egregious offshore tax loophole from his proposed tax extenders bill, it found its way back in with no public debate. The Controlled Foreign Corporation (CFC) Look Through Rule lets multinational giants avoid U.S. taxes by booking profits to shell companies in tax havens like the Cayman Islands. Nixing this loophole would have saved taxpayers over $2 billion over the course of the next two years. We’re encouraged that an amendment to strike this loophole has been filed by Senator Brown (D-OH), and we hope the committee will do right by taxpayers and strike it once again. Close scrutiny reveals that the CFC look through rule serves only one purpose: letting a handful of giant multinationals use sham subsidiaries in tax havens to shirk their tax responsibilities.

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News Release | U.S. PIRG | Budget, Tax

Bipartisan Legislators Come Together To Expose "Wrongdoing Write Offs"

Republicans and Democrats in both houses of Congress have introduced bills that would require agencies to disclose when their settlements with corporations allow tax write offs for payments made to resolve charges of wrongdoing.

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News Release | U.S. PIRG | Tax

Victory for Taxpayers and Consumers as Justice Dept. Denies Toyota $1.2 Billion Write-Off in Criminal Probe Settlement

Today, the Justice Department acted in the best interests of taxpayers and consumers, by denying Toyota a hidden $420 million tax benefit on its settlement for misleading consumers about dangerous car malfunctions.

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News Release | U.S. PIRG | Budget, Tax

Camp Corporate Tax Proposal Would Make Offshore Tax Dodging Easy for Large Multinationals

At a time when multinational giants are shifting profits offshore at an alarming rate to avoid billions in taxes, Chairman Camp’s bill would make our loophole-ridden corporate tax code even worse. Congress should take aggressive measures to crack down on tax haven abuse – like those put forth by Senator Levin in the Stop Tax Haven Abuse Act – instead of expanding the loopholes.

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News Release | U.S. PIRG | Budget, Tax

Drug Company’s $193M Settlement for Misconduct May Become Big Tax Write-Off

A new factsheet from the U.S. Public Interest Research Group documents how health care and pharmaceutical corporations are able to write off the payments they make to settle charges of wrongdoing, such as fraud, on their taxes.

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News Release | U.S. PIRG | Budget, Tax

Camp Corporate Tax Proposal Would Make Offshore Tax Dodging Easy for Large Multinationals

At a time when multinational giants are shifting profits offshore at an alarming rate to avoid billions in taxes, Chairman Camp’s bill would make our loophole-ridden corporate tax code even worse. Congress should take aggressive measures to crack down on tax haven abuse – like those put forth by Senator Levin in the Stop Tax Haven Abuse Act – instead of expanding the loopholes.

> Keep Reading
News Release | U.S. PIRG | Budget, Tax

Drug Company’s $193M Settlement for Misconduct May Become Big Tax Write-Off

A new factsheet from the U.S. Public Interest Research Group documents how health care and pharmaceutical corporations are able to write off the payments they make to settle charges of wrongdoing, such as fraud, on their taxes.

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News Release | U.S. PIRG | Democracy, Tax

Statement of Democracy Associate Emma Boorboor on U.S. PIRG’s comments to the IRS on its proposal on nonprofits’ candidate-related political activities

In the wake of the Supreme Court's Citizens United decision, the rules governing nonprofits' participation in political campaigns are more important than ever. We applaud the IRS's decision to address this problem head on, yet the initial proposal made by IRS missed the mark, and could cause real harm to the work of legitimate nonprofit organizations. We hope our comments to the IRS will encourage it to continue its important work to prevent abuse of the tax-exempt system by political operatives, while making improvements in the next round of drafting to encourage appropriate public engagement by nonprofits.

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News Release | U.S. PIRG | Budget, Tax

New Factsheet Outlines How Corporations Get Tax Write-Offs for Consumer Harm

A new factsheet from the U.S. Public Interest Research Group documents how corporations that have been charged with harming consumers through mortgage violations, price-fixing, racial discrimination and other charges have typically been able to write off the cost of their misdeeds on their taxes.

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News Release | U.S. PIRG | Tax

States could save $1 billion with simple, proven method to curb offshore tax dodging, new study finds

State taxpayers across the country could save over $1 billion from a simple reform to crack down on offshore tax dodging, according to a new report.

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Report | U.S. PIRG | Tax

Offshore Shell Games

This study reveals that tax haven use is ubiquitous among the largest 100 publicly traded companies as measured by revenue. 82 of the top 100 publicly traded U.S. companies operate subsidiaries in tax haven jurisdictions, as of 2012. All told, these 82 companies maintain 2,686 tax haven subsidiaries.

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Report | U.S. PIRG | Budget, Tax

Picking Up the Tab 2013

Tax haven abuse costs the United States approximately $150 billion in tax revenues every year. Even when tax haven abusers act perfectly legally, they force other Americans to shoulder their tax burden. The average U.S. tax filer would need to pay $1,026 in additional taxes to make up for lost revenue from tax havens. To pick up the tab for the taxes avoided by multinational corporations, the average small business in the United States would need to pay an average of $3,067 each in additional taxes.

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Report | U.S. PIRG Education Fund | Budget, Tax

Following the Money 2013

Every year, state governments spend tens of billions of dollars through contracts with private entities for goods and services, subsidies to encourage economic development, grants, and other forms of spending. Accountability and public scrutiny are necessary to ensure that state funds are well spent.

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Report | U.S. PIRG | Budget, Tax

Who's Afraid of Inversion?

Manipulating corporate structure to appear like a foreign company for tax purposes is called “inversion.” It sounds like an easy option for companies to reap the benefits of conducting business in America while paying next to nothing in taxes. But these days the threat of inversion is mostly bluster. Congress can better shore up our tax code by shutting down loopholes that allow profit shifting without being held hostage to the empty threat that companies will simply exempt themselves from U.S. laws by inverting their place of registration.

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Report | U.S. PIRG Education Fund | Budget, Tax

The Hidden Cost of Offshore Tax Havens

In 2011, states lost approximately $39.8 billion in tax revenues from corporations and wealthy individuals who sheltered money in foreign tax havens. Multinational corporations account for more than $26 billion of the lost tax revenue, and wealthy individuals account for the rest.

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Blog Post | Tax

What Do Jon Stewart, Elizabeth Warren, and Barack Obama Have In Common? | Dan Smith

All three of them spoke out this week against corporate tax dodging.

In his State of the Union speech, President Obama called for an economy where “everyone plays by the same set of rules” and where companies can’t avoid taxes by shifting profits overseas. That same night, Massachusetts Senate candidate Elizabeth Warren went on the Daily Show and called out 30 corporations that a recent U.S. PIRG and Citizens for Tax Justice study found paid more to lobby Congress than they did in federal income taxes. When Warren told this to John Stewart on the Daily Show, it made the usually unflappable comedian’s jaw drop.

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Blog Post | Tax

The "Dirty Thirty" Corporations that Spend More on Lobbying than Taxes | Phineas Baxandall

Two years ago the Supreme Court's misguided Citizens United decision struck down long-standing Congressional limits on the political power of large corporations by vastly expanding the legal metaphor that "corporations are people." Now there is fresh evidence that corporate influence over Congress makes it easy for those same corporations to avoid their civic duty of paying taxes.

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Blog Post | Budget

Problems With Privatized Law Enforcement's New Frontier | Phineas Baxandall

One in five Americans lives in a jurisdiction that outsources traffic ticketing this way, according to a newly released report from the U.S. Public Interest Research Group, titled "Caution: Red Light Cameras Ahead; The Risks of Privatizing Traffic Law Enforcement and How to Protect the Public." And a report released by the Justice Department suggests this trend may accelerate under the twin pressures of budget pressure and intense lobbying.

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Blog Post | Budget

How Much Did You Pay for Tax Dodging Corporations? | Phineas Baxandall

Yesterday, millions of Americans rushed to the post office to file their federal income tax returns. For all of us, the checks we wrote were an average of $434 higher because of the burden we are forced to shoulder for major corporations and wealthy individuals who use offshore tax havens to avoid paying their share.

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PRIORITY ACTION

Some of the nation’s most prosperous people and companies — including GE, Google and Goldman Sachs — avoid paying the taxes they owe, costing taxpayers $150 billion just last year.

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