Report: Offshore tax havens cost U.S. $100B
Goldman Sachs is reportedly among the many offenders when it comes to large corporations sheltering their fortunes from the IRS in overseas tax havens.
/ Mario Tama/Getty ImagesOverall, the U.S. loses approximately $100 billion in tax revenues every year as corporations and individuals shelter their fortunes in foreign bank accounts.
In 2009, President Barack Obama launched a major initiative against overseas tax havens with new tax laws, new reporting requirements and an army of 800 new IRS agents.
"I want to see our companies remain the most competitive in the world. But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens," Mr. Obama said at the time, according to the Washington Post.
However, today's report by U.S. PIRG reveals that the president still has a long way to go.
Some of the report's key findings include:
- In 2010, making up for this lost revenue cost the average U.S. tax filer $434. That's enough money to feed a family of four for three weeks.
- The taxpayers who pick up the largest share of the tab live in Delaware and New Jersey. On average, tax filers in those states paid an additional $920 and $752, respectively.
- Some of America's biggest companies - including many that have taken advantage of government bailouts or rely on government contracts - use tax havens. As of 2008, 83 of the 100 largest publicly-traded U.S. corporations maintain revenues in offshore tax haven countries.
- Goldman Sachs, which reported more than $2 billion in profit in 2008, was able to use its 29 tax haven subsidiaries to reduce its federal tax bill to just $14 million. That means that Goldman Sachs' CEO Lloyd Blankfein, who made $42.9 million that year, earned more than three times the amount that the company paid in federal taxes.
- General Electric appears to have paid no federal income taxes in 2010, despite reporting profits in the United States of $5.1 billion. The biggest company in the country, GE has lobbied hard for tax breaks and loopholes in the federal tax code, and shifted many of its profits to tax havens to avoid paying U.S. taxes. GE employs nearly 1,000 people in its tax department to help exploit those loopholes, but has laid off one-fifth of its U.S.-based workers since 2002.
Click on the video player below to watch a recent "60 Minutes" report by Lesley Stahl on tax havens.
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The New York Times
updated 6/20/2011 9:03:30 AM ET 2011-06-20T13:03:30
Some of the nation's largest corporations have amassed vast profits outside the country and are pressing Congress and the Obama administration for a tax break to bring the money home.
Apple has $12 billion waiting offshore, Google has $17 billion and Microsoft, $29 billion.
Under the proposal, known as a repatriation holiday, the federal income tax owed on such profits returned to the United States would fall to 5.25 percent for one year, from 35 percent. In the short term, the measure could generate tens of billions in tax revenues as companies transfer money that would otherwise remain abroad, and it could help ease the huge budget deficit.
I just thought this articles might be interesting. I would also like to keep some of my money home a 5.25 percent.
Breathes there the man with soul so dead. who ne'er to himself hath said, This is my home, my native land? Yes, and his name is Republican.
And what did he do to earn the 820k from foreign countries? Kickbacks for "foreign aid"?
You are literally out to lunch with your logic. The "citizens" of other countries did NOT earn this money and to call it xenophobic" is laughable. A tax haven is simply a paper shuffle, a slight of hand, a card trick so to speak. One simple setup is to create a basic pyramid or triangle scheme (though in the case of very large corporations it will be more of a maze). A holding company off shore (with next to ZERO employees and no accountability) will show the large profit (and hense no US tax payable), which allows the operating company residing in the US to show a MUCH smaller profit on their books. Almost ALL the earning and profits are in REALTY comming from the US (and from the backs of US workers and US economic system), but the paper trail shows the bulk of the earnings coming from an off shore companie(s), when in REALTY the profit is derived in the US and from US workers. Only the paper trail says otherwise. It is nothing more than a charade, "legalized" or loop hole driven stealing (unless you are one that believes US citizens or US business should not pay US taxes on their US generated profits).
The surprising part is not that corporations or wealthy individuals do this (human nature being what it is), but that that they are so brazen, ie, it is done to such a large scale with impunity.