Loopholes Allow Many Corporations to Pay Less Than Individuals and Households
Los Angeles, CA April 15, 2011 – Major corporations and some individuals avoid a total of as much as $100 billion a year in federal taxes by “off-shoring” the profits they make here in the U.S. or by setting up sham headquarters in tax haven countries. As a result, California taxpayers are left footing the bill.
According to Tax Shell Game, a new California Public Interest Research Group (CALPIRG) report, the use of offshore tax havens results in $434 in additional tax burden for taxpayers around the country. Here in California, it’s $440 per taxpayer.
“There is clearly something wrong when individuals and households pay more in taxes than huge corporations. Reports of giant corporations like G.E., which make billions in profits, paying little to nothing in income taxes last year show us that reform is well overdue.” explained Pedro Morillas CALPIRG Consumer Advocate.
In the weeks and months leading up to Tax Day, Congress debated the national debt, rising deficits, and across the board cuts to a range of public priorities such as food safety inspectors, Pell grants and clean air and water programs. Congress needs to address the deficit by closing corporate tax loopholes, rather than cutting these public priorities.
Nearly two-thirds of corporations doing business in the U.S. pay no income taxes at all. Companies that received taxpayer-funded bailout money or receive lucrative government contracts and use tax havens include American Express, A.I.G, Exxon Mobil, Goldman Sachs and Pfizer.
“Main street businesses and ordinary taxpayers without access to an army of lawyers and accountants to devise elaborate tax avoidance schemes are forced to pick up the tab every year. We’ve already bailed out the Wall St. banks and big corporations – do we really need to pay their taxes as well?” Morillas added.
To read Tax Shell Game click here.
To learn more about the companies who lobby against reforms, read U.S. PIRG’s report, Who Slows the Pace of Tax Reform.
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CALPIRG is a nonprofit nonpartisan taxpayer and consumer protection organization that stands up to powerful interests on behalf of all Californians.
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