Published on 20 July 2010. Linked from the New York Times.
By Lynnley Browning
On Tuesday, hundreds of these businesses will join in the announcement of a grass-roots campaign against tax avoidance that has already drawn support from a prominent lawmaker.
The campaign, Business and Investors Against Tax Haven Abuse, is backed by Senator Carl Levin, Democrat of Michigan, who in recent years has investigated offshore tax havens and the large companies and wealthy investors that use them.
Senator Levin plans to announce the campaign with its supporters, a coalition of three nonprofit groups — the American Sustainable Business Council, Business for Shared Prosperity and Wealth for the Common Good.
They will release a 25-page report that contends that American multinational corporations use havens to avoid $37 billion in federal taxes each year, a figure the groups call conservative.
“This $37 billion could be used to fund initiatives to support America’s small businesses — the nation’s biggest job creators — by increasing their access to capital, increasing their opportunities to invest and rewarding entrepreneurship,” the report says.
With that money, the report says, “we could establish a $30 billion Small Business Lending Fund to provide capital investments to small community banks (those with less than $10 billion in assets) to increase lending to small enterprises.”
Bob Keener, a spokesman for a coalition member, Business for Shared Prosperity, said on Monday that 400 executives, investors and representatives of businesses had signed a petition in support of the campaign. They included a small shoe company in Maine, a consultancy in Virginia and cleaning services, he said.
The campaign is unusual because it is the first time that small businesses have organized to combat offshore tax avoidance and evasion in a significant way.
“The Business and Investors Against Tax Haven Abuse campaign represents the first time in recent years that business people who believe tax havens are bad for business are mobilizing publicly to end the abuse,” Mr. Levin said Monday in a statement.
The Treasury Department estimated in 2009 that the international gap between taxes owed and taxes paid ranged from $43 billion to $123 billion a year for corporations and individuals.
The report calls for laws that would block transfers of intellectual property designed to evade taxes; ban shell corporations that earn profits offshore, even when a corporation’s management team is based in the United States; repeal a rule that allows American corporations to reduce or eliminate their United States tax bills if 80 percent of their business takes place overseas; and set penalties for government contractors that use tax havens.
Join us for – Overseas Tax Havens Should Be Illegal: A Telephone Briefing
• Help us close overseas tax havens and recover tens of billions of revenue.
• Eliminate the unlevel playing field that favors big companies over domestic business.
All corporations should pay their fair share of taxes for the infrastructure and services that support the economy on which their businesses depend. Yet, many global corporations are taking advantage of tax haven loopholes in the tax code to avoid taxes. In fact, our upcoming report will show that the corporate taxes paid by giant companies is a much lower rate than for smaller businesses , mostly because of tax haven abuse. By avoiding their fair share of taxes, companies like Best Buy and Citigroup, for example, shift their responsibility for taxes to the local appliance store or community bank.
We’ve teamed up with Business for Shared Prosperity, the American Sustainable Business Council and others to form Business and Investors Against Tax Haven Abuse, to push law makers to close these loopholes.
Tax Haven Briefing Call: Tuesday, July 13, 1:00 PM EASTERN TIME
You are invited to learn more from a telephone briefing by Elise Bean, the legislative expert on the topic for Senator Carl Levin, lead sponsor on legislation to close tax havens. If you’d like to participate, please email Bob Keener at bob@wealthforcommongood.org for the call-in number.
Sign Our Petition: Going Public in Two Weeks
If you haven’t already, please join our campaign by signing the petition. Momentum is building. In the quiet phase we’ve already collected 340 signatures. Please help us get to 500 before the public launch. The petition says, in part:
We, the undersigned business owners, executives and investors, call on the President and Congress to end tax dodging and support a level playing field for business by enacting strong legislation to stop tax haven abuses. Offshore tax havens reward tax evaders, rob public coffers of needed revenue and offload taxes to responsible businesses and households.
There is no justification for tax avoidance and evasion through tax havens. They should be made illegal and strongly enforced. Everyone needs to pay their fair share to keep America moving forward.