Missing in all the partisan screaming and yelling about federal budget deficits and borrowing limits is any coherent talk about finding more tax revenue and a measure of equity for ordinary taxpayers.
Michigan Sen. Carl Levin has stepped up to the challenge. He introduced the Stop Tax Haven Abuse Act, Senate Bill 1533, to close offshore corporate tax loopholes.
Levin estimates the legislation would raise $220 billion over a decade. That is enough money to push back the across-the-board cuts of sequestration, he explained Wednesday in a telephone conference call.
As chair of the Senate Permanent Subcommittee on Investigations, Levin knows all the scams and devices of offshore corporate-tax avoidance and evasions.
Research found 30 U.S. companies with $160 billion in profits had paid no taxes during a three-year study period. More than $1.3 trillion stashed offshore can be traced to 20 companies.
Levin also knows that when all the ruses are employed the tax burden falls on domestic companies, small business and families.
The senators bill, which has three Democratic sponsors so far, would go after the process of transferring lucrative intellectual property to tax havens. He would end tax deductions for companies that move production and jobs offshore and receive deductions to build and operate the new plants though none of the foreign profits are taxable.
Corporate profits get recycled and parked overseas, then repatriated via loans and other devices that make the eyes of accountants and lawyers glisten.
Another approach Levin does not favor is a territorial-tax system. It creates even more incentives to shift profits around the globe, avoid U.S. taxes and move more jobs overseas.
Americans for Tax Fairness cites a Congressional Research Report that American companies report earning 43 percent of overseas profits in five countries: Bermuda, Ireland, Luxembourg, the Netherlands and Switzerland tax havens where the companies have scant employment or foreign investments.
Originally posted here:
Legislation to curb foreign tax havens would bolster budget