Offshore Tax Havens: A State-By-State Breakdown Of The Cost

[dbackjon]

A Senate report estimated in 2008 that the United States loses up to $100 billion a year in tax revenue to offshore tax havens (PDF). In a report released Wednesday, the U.S. Public Interest Research Group offers a state-by-state breakdown of the cost to taxpayers of tax revenue lost to "shell companies and sham headquarters" in places like Switzerland and the Cayman Islands.

The practice soaks dutiful taxpayers in every state for hundreds of millions of dollars, according to U.S. PIRG. The citizens of New York and Texas shoulder over $8 billion a year, and the good people of California are on the hook for an extra $11 billion.

Click here for U.S. PIRG's table with the state-by-state breakdown of the burden shifted to taxpayers.

U.S. PIRG came up with the state numbers by dividing the $100 billion figure by the percentage of total federal revenue contributed by each state. The nonprofit released its report on tax day to drive home a message:

"This is the day when we're all working hard, rushing to the post office, filing our returns, and then to hear about these large multi-billion dollar corporations who have used gimmicks to avoid paying their fair share -- it's something that should end this year," says John Krieger, a staff attorney with U.S. PIRG.

U.S. PIRG's report, titled "Tax Shell Game," highlights some findings from a January report by the Government Accountability Office that found over 80 percent of the hundred biggest U.S. companies took advantage of tax havens. In 2008 the GAO found that one five-story building in the Cayman Islands, known as the "Ugland House," contained 18,857 registered businesses, very few of which had anything but a P.O. box there. Bailout beneficiaries Morgan Stanley, Citigroup, and Bank of America boast over 300 subsidiaries in the Cayman Islands.

http://www.huffingtonpost.com/2009/04/1 ... 86640.html

State by State Breakdown here:
http://www.huffingtonpost.com/thenewswi ... taxes.html

[AshevilleApp]

Grab the popcorn, this should be fun!

[D1B]

Grab the popcorn, this should be fun!

We're expecting a heat wave here in Wisconsin. They better add a few degrees to the forecast to factor in Tman's follow up excuse.

[danefan]

Don't hate the player - hate the game.

Sorry, but there is not better way to explain it. As long as the law exists the way it exists, companies are well within their right to keep their profits offshore in low-tax jurisdictions.

If the US wants to get profits back in the US tax base they should lower corporate taxes or decrease the double taxation effect on repatriated earnings.

And BTW, some of the income generated in these offshore tax havens is taxable to the US parent under the Federal tax code - its called Subpart F and it was intended to combat some of the effects of low tax jurisdictions.

State tax revenue, however, isn't effected by Subpart F.

[dbackjon]

Don't hate the player - hate the game.

Sorry, but there is not better way to explain it. As long as the law exists the way it exists, companies are well within their right to keep their profits offshore in low-tax jurisdictions.

If the US wants to get profits back in the US tax base they should lower corporate taxes or decrease the double taxation effect on repatriated earnings.

And BTW, some of the income generated in these offshore tax havens is taxable to the US parent under the Federal tax code - its called Subpart F and it was intended to combat some of the effects of low tax jurisdictions.

State tax revenue, however, isn't effected by Subpart F.

No one is hating the player (too much), just the tax codes that allow this to happen.

And your reply about lower corporate taxes is not telling the whole story.

I have brought up here before the tax dodges used by 100% US corporations and Intellectual Property scams. Corporate Tax rate would have to be almost zero to make these scams not cost effective for the companies to use them, so lower the Tax Rate would be counter productive.

First step needs to be to CLOSE the loopholes, not lower already low tax rates.

[Ivytalk]

Don't hate the player - hate the game.

Sorry, but there is not better way to explain it. As long as the law exists the way it exists, companies are well within their right to keep their profits offshore in low-tax jurisdictions.

If the US wants to get profits back in the US tax base they should lower corporate taxes or decrease the double taxation effect on repatriated earnings.

And BTW, some of the income generated in these offshore tax havens is taxable to the US parent under the Federal tax code - its called Subpart F and it was intended to combat some of the effects of low tax jurisdictions.

State tax revenue, however, isn't effected by Subpart F.

No one is hating the player (too much), just the tax codes that allow this to happen.

And your reply about lower corporate taxes is not telling the whole story.

I have brought up here before the tax dodges used by 100% US corporations and Intellectual Property scams. Corporate Tax rate would have to be almost zero to make these scams not cost effective for the companies to use them, so lower the Tax Rate would be counter productive.

First step needs to be to CLOSE the loopholes, not lower already low tax rates.

Actually, danefan is right. America's corporate income tax is the second highest in the Western world.

That said, the Dakotas just aren't trying hard enough!

[Cleets Part 2]