Warm Southern Breeze

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Congressional Budget Office: Offshore Corporate Tax Havens Cost each Citizen $1259

Posted by Warm Southern Breeze on Thursday, April 17, 2014

Historically, our nation has prospered when tax rates on the ULTRA wealthy and corporations were highest.

In the period following World War II, under President Dwight David Eisenhower – a Republican, and former Supreme Allied Commander / 5ive Star General – Corporate Tax rates have continually declined.

Now, during the Obama administration, they are at the LOWEST they have EVER been.

Corporate Income Tax Rates have continually declined

Corporate Income Tax Rates have continually declined the peaked during the Eisenhower administration. The formula is: b/(a+b) Where (a) Corporate Profits After Tax (without IVA and CCAdj), Billions of Dollars, Seasonally Adjusted Annual Rate (CP); And (b) Federal Government: Tax Receipts on Corporate Income, Billions of Dollars, Not Seasonally Adjusted (FCTAX)

Tax Havens Leave U.S. Filers $1,259 Tab Each, Report Says

U.S. taxpayers would need to pay an average of $1,259 more a year to make up the federal and state taxes lost to corporations and individuals sheltering money in overseas tax havens, according to a report.

Tax haven abusers benefit from America’s markets, public infrastructure, educated workforce, security and rule of law -– all supported in one way or another by tax dollars -– but they avoid paying for these benefits,” U.S. Public Interest Research Group said in the report released today, the deadline for filing 2013 taxes.
ref: http://www.uspirg.org/reports/usp/picking-tab-2014

“Instead, ordinary taxpayers end up picking up the tab, either in the form of higher taxes, cuts to public spending priorities, or increases to the federal debt,” it said.

In total, the U.S. loses $150 billion in federal revenue and another $34 billion in state revenue annually because of money parked in tax havens, the Boston-based consumer advocacy group concluded.

That’s almost 5 percent of total federal revenue. The U.S. is projected to raise $3.032 trillion this year, up from $2.775 trillion for fiscal year 2013, according to the Congressional Budget Office.
ref: https://www.cbo.gov/sites/default/files/cbofiles/attachments/45229-UpdatedBudgetProjections_2.pdf

U.S. PIRG released the report as it tries to increase pressure on lawmakers to change how companies pay taxes on income credited to foreign subsidiaries.

Offshore Accumulations

The largest U.S.-based companies have accumulated $1.95 trillion outside the U.S., up 11.8 percent from a year earlier, according to securities filings from 307 corporations reviewed by Bloomberg News.

Together, they added $206 billion to their stockpiles of offshore profits last year, leaving earnings in low-tax countries until Congress gives them a reason not to. Three multinational firms — Microsoft Corp., Apple Inc. and International Business Machines Corp. — added $37.5 billion, or 18.2 percent of the total increase.

Prospects have dimmed for a revision of the U.S. tax code this year that would have addressed offshore havens.

President Barack Obama, House Ways and Means Committee Chairman Dave Camp, a Michigan Republican, and Senate Finance Chairman Ron Wyden, an Oregon Democrat, support lowering the corporate rate and making significant changes to the taxation of foreign income.

No proposals — including a draft plan from Camp to lower the corporate rate to 25 percent and levy a smaller one-time tax on accumulated profits — have been scheduled for a vote.

To contact the reporter on this story: Derek Wallbank in Washington at dwallbank@bloomberg.net

To contact the editors responsible for this story: Jodi Schneider at jschneider50@bloomberg.net Laurie Asseo

http://www.bloomberg.com/news/print/2014-04-15/tax-havens-leave-u-s-filers-thousand-dollar-tab-report.html

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