Republicans Defend Corporate Tax Havens in the Cayman Islands
Yesterday the Huffington Post had the following:
President Obama and Treasury Secretary Tim Geithner announced on Monday a crackdown on offshore tax havens that could produce $210 billion in new tax revenue over the next decade.
You’d think, since those tax havens have been in operation for decades, that Congress would hop on board the crackdown. Think again!
The White House is facing opposition to it from the business community (which I would expect) and Congress (which floors me). A Republican staffer circulated a Bloomberg report that said the crackdown "would be the biggest tax increase on U.S. corporations since 1986." (Hell fire, it couldn’t be a tax increase because they don’t pay any taxes to increase. That is why they are operating through the Cayman Islands, to avoid paying taxes.)
Not surprising Senate GOP leader Mitch McConnell (KY) said later on Monday that he could not endorse Obama’s plan since it "gives preferential treatment to foreign companies at the expense of U.S.-based companies."
The amount Obama’s plan would reportedly save is a far cry from the estimated $1 trillion the United States loses to offshore tax havens over a ten-year period. A 2008 Senate report (PDF) estimated that "the United States loses an estimated $100 billion in tax revenues due to offshore tax abuses" every year.
In January, the Government Accountability Office issued a report (PDF) that found that 83 of the 100 largest publicly traded U.S. corporations reported subsidiaries in countries listed as tax havens or "financial privacy jurisdictions."
Many of those corporations are beneficiaries of billions in taxpayer dollars under the Troubled Asset Relief Program. Morgan Stanley, for instance, boasts 273 subsidiaries in tax havens, with 158 in the Cayman Islands alone. Citigroup’s got 427, with 90 in the Cayman Islands, and 59 of Bank of America’s tax-haven subsidiaries are there as well.
How do you like those apples!
The GAO found 18,857 businesses are registered at just one address in the Cayman Islands — the "Ugland House." The report said that "Ugland House registered entities included investment funds, structured-finance vehicles, and entities associated with other corporate activities."
On tax day, April 15, the U.S. Public Interest Research Group issued a report with a state-by-state breakdown of the cost to taxpayers of corporate tax evasion in offshore havens.
Remember, Obama told us right here in Pahrump, that change to Washington would not be easy and that he needed each of us to support him, else it can’t be done. This is a good example.
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1 comment
I watched a documentary about this in my Intro. to Legal Studies class. I have some notes on the exact numbers, still the whole thing was difficult to understand. All I have to say is tax those punks, they make the most money and the leaste amount of taxes. Maybe now we can have our universal health care and Kyle might be able to get his wisdom teeth pulled too. They are currently impacted but with no insurance he just has to deal with it. He applied for state health care but he is too rich to qualify. I guess working 20 hours a week for $8 an hour is just too much.
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