Want to avoid the fiscal cliff? Look offshore
As our lawmakers in Washington figure out how to save $4 trillion over the next 10 years, they seem to have forgotten about a huge source of revenue both sides should be able to agree on: closing corporate tax loopholes.
A study by the Government Accountability Office found that 83 of the top 100 publicly- traded companies use offshore tax havens to skip out on paying federal taxes.
By using armies of tax attorneys to make profits legitimately made in America magically appear on the books in shell companies in the Cayman Islands, this offshore tax haven abuse costs the federal government an estimated $150 billion a year in lost revenue.
Over the course of 10 years, that’s more than one-third of the $4 trillion that Congress is looking to cut.
Before Congress decides whose taxes to raise or what services to cut, it should make sure those companies pay what they already owe.
Note to readers – Anu Dathan is a program associate with Illinois Public Interest Research Group.