Close Corporate Tax Loopholes

PERVASIVE TAX AVOIDANCE—Across the country, some of the nation’s best-known companies — including GE, Google and Goldman Sachs — have avoided paying the taxes they owe, costing Arizonans $2.2 billion last year.

LOOPHOLES COST ARIZONANS $2.2 BILLION

No company should be able to game the tax system to avoid paying what it legitimately owes. And, yet, establishing shell companies in offshore havens for the purpose of tax avoidance is becoming more the rule than the exception for at least 83 of the nation's top 100 publicly traded companies. GE, Google, Goldman Sachs and dozens of others have created hundreds of phantom entities with nothing more than a clever tax attorney and P.O. box.

The official estimate of how much Americans lose in tax revenue is $150 billion per year. That's money that is shouldered by average taxpayers, either through additional taxes today or additional debt to be paid by the next generation.

It’s not illegal, but it’s not right.

The result? The average taxpayer paid $803 more this year to cover the $150 billion that G.E. and others that use offshore tax havens skipped out on. And small businesses and companies that don’t use these schemes have to struggle to compete with those that do.

Meanwhile, the Arizona Legislature and Congress are considering deep cuts for essential public programs — from education, to health care, to clean air and drinking water. They’re asking us to tighten our belts and make sacrifices, while giving the tax haven crew a free ride.

We are pushing for commonsense changes that simply say if corporations are based here and generate profits here, then they should, like all of us who earn income in here, pay the taxes they owe.

Issue updates

Blog Post | Tax

An Open Letter to Arizona, California, Nevada, New Mexico, and Texas Officials About Tesla Motors | Diane E. Brown

Today we joined with Good Jobs First and organizations in California, Nevada, New Mexico, and Texas to send a letter to elected officals about Tesla Motors.

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News Release | Arizona PIRG Education Fund | Tax

Bank of America settlement loophole creates at least $4 billion burden for taxpayers

Taxpayers will shoulder anywhere from $4 to $5.8 billion of today’s $16.65 billion Bank of America settlement with the U.S. Justice Department. The settlement, which releases the bank from charges of alleged illegal activity related to mortgage activities, specifically refuses to stop Bank of America from writing the settlement off as a tax break — which means much of the settlement cost will ultimately be shouldered by U.S. taxpayers.

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News Release | Arizona PIRG Education Fund | Tax

Study: 70% of Fortune 500 Companies Used Tax Havens in 2013

Tax loopholes encouraged more than 70 percent of Fortune 500 companies – including Avnet and Insight Enterprises in Arizona  – to maintain subsidiaries in offshore tax havens as of 2013, according to “Offshore Shell Games,” released today by the Arizona PIRG Education Fund and Citizens For Tax Justice. Collectively, the companies reported booking nearly $2 trillion offshore for tax purposes, with just 30 companies accounting for 62 percent of the total, or $1.2 trillion.

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Report | Arizona PIRG Education Fund | Tax

Offshore Shell Games 2014

Many large U.S.-based multinational corporations avoid paying U.S. taxes by using accounting tricks to make profits made in America appear to be generated in offshore tax havens – countries with minimal or no taxes. By booking profits to subsidiaries registered in tax havens, multinational corporations are able to avoid an estimated $90 billion in federal income taxes each year. These subsidiaries are often shell companies with few, if any employees, and which engage in little to no real business activity.

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News Release | Arizona PIRG Education Fund | Tax

Poll: Public Wants Federal Agencies to Disclose and Restrict Corporate Tax Write Offs for Out-of-Court Settlements

In recent years, public outrage has built as federal agencies have allowed out-of-court settlements for corporate wrongdoing — like BP’s gulf oil spill and JPMorgan’s toxic mortgages — to be written off for multibillion-dollar tax breaks. A new poll confirms what has long been apparent: The public overwhelmingly disapproves of these write offs, and has a strong preference for federal agencies to be both more transparent and more restrictive of tax deductions for future settlements.

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News Release | Arizona PIRG Education Fund | Tax

Poll: Public Wants Federal Agencies to Disclose and Restrict Corporate Tax Write Offs for Out-of-Court Settlements

In recent years, public outrage has built as federal agencies have allowed out-of-court settlements for corporate wrongdoing — like BP’s gulf oil spill and JPMorgan’s toxic mortgages — to be written off for multibillion-dollar tax breaks. A new poll confirms what has long been apparent: The public overwhelmingly disapproves of these write offs, and has a strong preference for federal agencies to be both more transparent and more restrictive of tax deductions for future settlements.

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News Release | Arizona PIRG Education Fund | Tax

New Report: Arizona Receives a ‘B’ in Annual Report on Government Spending Transparency

 

According to a new report, Arizona performs well when it comes to government spending transparency, but has room for improvement. Arizona received a ‘B’ in the fifth annual Arizona PIRG Education Fund spending transparency report, Following the Money 2014: How the States Rank on Providing Online Access to Government Spending Data.

 

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News Release | Arizona PIRG | Tax

Bipartisan Legislation would make Arizona’s Economic Development Subsidies More Transparent

The State of Arizona spent nearly $100M of taxpayer money on corporate tax credits intended to stimulate economic development in 2011, but the public received no information about the results of these programs or which companies received the tax credits. A new bill, House Bill 2586, would require disclosure of the recipients of these tax credits, and it has bi-partisan support from a number of lawmakers and Arizona PIRG.

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News Release | Arizona PIRG | Tax

Arizona PIRG Applauds Sen. McCain for Co-Sponsoring Bill Barring Tax Write-Offs for Corporate Wrongdoing

Arizona PIRG statement on Sen. McCain’s decision to co-sponsor bipartisan legislation that would prevent corporations from reaping massive tax windfalls from the payments made to settle allegations of wrongdoing. This comes on the heels of the Department of Justice announcement that the majority of JPMorgan’s expected $13 billion mortgage abuse settlement could be tax deductible.

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Media Hit | Tax

The Center for Public Integrity: State pro-business organizations are publicly funded, but privately controlled

Serena Unrein, the public interest advocate at Arizona PIRG, said there’s been no evidence of malfeasance at the Arizona Commerce Authority, but that without full transparency, it’s impossible to know for sure.

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Report | Arizona PIRG | Tax

Picking Up the Tab 2013

Some U.S.-based multinational firms and individuals avoid paying U.S. taxes by using accounting tricks to shift profits made in America to offshore tax havens—countries with minimal or no taxes. They benefit from their access to America’s markets, workforce, infrastructure and security; but they pay little or nothing for it—violating the basic fairness of the tax system and forcing other taxpayers to pick up the tab.

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Report | Arizona PIRG Education Fund | Tax

The Hidden Cost of Offshore Tax Havens

When U.S. corporations and wealthy individuals use offshore tax havens to avoid paying taxes to the federal government, it is an abuse of our tax system. Tax haven abusers benefit from our markets, infrastructure, educated workforce, and security, but they pay next to nothing for these benefits. Ultimately, taxpayers must pick up the tab, either in the form of higher taxes, cuts to public spending priorities, or increased national debt.

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Report | Arizona PIRG Education Fund | Tax

Subsidizing Bad Behavior

Corporations accused of wrongdoing commonly settle legal disputes with government regulators out of court. Doing so allows both the company and the government to avoid going to trial and the agency gets to appear as if it is teaching the company a lesson for its misdeeds. However, very often the corporations deduct the costs of the settlement on their taxes as an ordinary business expense, shifting a significant portion of the burden onto ordinary taxpayers to pick up the tab.

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Report | Arizona PIRG | Tax

Picking up the Tab

Some U.S.-based multinational firms or individuals avoid paying U.S. taxes by transferring their earnings to tax haven countries with minimal or no taxes. These tax haven users benefit from their access to America’s markets, workforce, infrastructure and security; but they pay little or nothing for it—violating the basic fairness of the tax system and forcing other taxpayers to pick up the tab.

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Report | Arizona PIRG Education Fund | Food, Tax

Apples to Twinkies

America is facing an obesity epidemic – one that’s hitting children especially hard. The rise in childhood obesity has many causes, but one of the most important is the increased prevalence of high-fat, heavily sweetened junk food.  And shockingly, American taxpayers are spending billions to subsidize junk food ingredients, making the problem worse.

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Priority Action

The CUT Loopholes Act would put an end to the price and profit shifting that allows publicly traded companies to engage in pervasive tax avoidance.

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