Financial Reform Advocates Call on the Senate to Close Expensive Tax Loopholes
January 16th, 2014
The Oblate JPIC Office joined others in the FACT Coalition in signing a letter sent this morning to Chair of the Senate Finance Committee, Max Baucus, on proposed international tax reform. The group said a proposal before the Committee “rightly identifies the need to stop corporations from shifting profits to offshore tax havens to avoid taxes. Unfortunately, the proposal falls short in three critical ways and leaves room for the offshoring of jobs and profits to continue:”
1. “It does not sufficiently end incentives for multinational corporations to shift profits offshore, which costs taxpayers an estimated $90 billion per year and creates an uneven playing field for small and domestic businesses.”
2. “It is revenue neutral, earmarking all the revenue raised from closing loopholes for reductions in the corporate tax rate. With federal revenue from corporations hovering at multigenerational lows, precisely because of the offshore profit shifting incentives, this is unacceptable.”
3. “It should hold corporations accountable to report their profits and revenues in a consistent manner to government, shareholders and the public.”
In arguing for doing away with lucrative corporate tax loopholes, the reform-minded groups argue that “Corporations benefit from the operation of government just as individuals do (and more so in some cases due to myriad tax benefits and lucrative contracts) and should be expected to contribute to financing our democracy, public services and rule of law. However the corporate share of federal revenue was just eight percent in 2011, having declined by more than 60 percent in the last 50 years.”
“Due to huge loopholes and other factors, dozens of big corporations pay no federal income taxes, while reaping billions of dollars in profits. According to the Government Accountability Office, corporations pay just a 12.6 percent effective tax rate, far below the statutory rate of 35%.”
Learn more, read the letter to Senate Finance Committee Chair Max Baucus (Download PDF)
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