Statement from U.S. PIRG Advocate Michelle Surka about the recent Trump Administration tax proposal.
“President Trump’s tax plan fails to close loopholes that allow for offshoring and the gaming of our tax system.
In fact, this plan makes matters worse. Tax loopholes and tax haven abuse wouldn’t just be a flaw in our tax system, they would be a built-in feature.
No matter what the U.S. tax rate is, there will always be a benefit if we continue to allow companies to pretend that their profits are from a country like the Cayman Islands, which has a tax rate of 0%. President Trump’s plan, as outlined, leaves the door wide open for the biggest multinationals to take a permanent vacation from paying taxes by virtue of that kind of loophole. The Trump Administration has already suggested it plans to un-do some of the progress made to curb abusive transfer pricing, earnings stripping, and corporate inversions. This proposal goes even further in the wrong direction.
And noone should be fooled by talk of benefits to “Main Street.” Only the biggest multinational corporations would benefit under this proposal. Currently just 30 Fortune 500 companies hold over 60% of the cash booked offshore, and they would benefit disproportionately from this plan.
We urge Congress to reject this plan and prioritize tax reform that levels the playing field for small businesses. Any tax plan should end deferral and close loopholes, not make tax dodging a permanent part of our system.”