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Albuquerque, NM, April 15 – While a lot of attention is given on Tax Day to how tax dollars are spent, one watchdog group is instead focused on the revenue lost every year – $100 billion – thanks to loopholes, tax avoidance and tax cheats.
Each year, major corporations and individuals avoid as much as $100 billion a year in federal taxes by “off-shoring” the money they make here in the U.S. or by setting up sham headquarters in tax haven countries. Taxpayers are left footing the bill.
According to Tax Shell Game: What Do Tax Dodgers Cost You?, a new New Mexico Public Interest Research Group report, this results in an average of $500 in additional tax burden for taxpayers. Here in New Mexico, it’s $297 per taxpayer.
As Congress scrambles to pay for a number of tax cuts, tax breaks and new programs, they may finally take a serious look at corporate loopholes and tax avoidance.
Senator Carl Levin (D-MI), who sponsors the Stop Tax Haven Abuse Act in the Senate, and Chairs the Permanent Subcommittee on Investigations, said: “The United States cannot afford to let offshore tax cheats continue to rob the U.S. Treasury of billions of dollars each year that are needed to support education, health, defense and other needs. While Congress enacted a strong new law this year that will help tackle the offshore problem, more can and should be done to make sure everyone pays their fair share.”
Nearly two-thirds of both U.S.-controlled and foreign-controlled corporations pay no taxes at all. Companies that use tax haven countries include American Express, A.I.G, Exxon Mobil, Goldman Sachs and Pfizer – all of which were either recipients of taxpayer-funded bailout money or receive lucrative government contracts.
“Tax haven abuse harms American competitiveness and raises the tax burden on honest taxpayers, including small businesses, who play by the rules. We should shut the tax loopholes that encourage corporations to ship their profits and American jobs offshore. A level playing field requires all to contribute their fair share and restoring fiscal discipline demands it,” added Representative Lloyd Doggett (D-TX), the House bill’s sponsor and member of the powerful Ways and Means Committee.
“America cannot afford to lose any more revenue or any more jobs. The time for reform is now,” explained Nicole Tichon, Tax and Budget Reform Advocate for NMPIRG.
“Without reform, main street businesses and ordinary taxpayers without access to elaborate schemes and tax havens are forced to pick up the tab every year. We’ve already rescued the banks and other big corporations – is it fair to ask us to pay their taxes?” Tichon continued.
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