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Bill Would Close Tax Loophole
CWA is urging U.S. House members to support the Corporate Patriot Enforcement Act, H.R. 3884, which would limit the ability of companies to move their headquarters to foreign countries to avoid paying taxes in the United States.
Companies based in the United States have to pay taxes on income earned domestically and abroad. But in countries such as Bermuda, companies only have to pay income on taxes earned within that nation’s borders — a miniscule amount.
The proposed bill, introduced by Rep. Richard Neal (D-Mass.) with 146 co-sponsors, would require American companies that left the United States after Sept. 11, 2001 to resume paying U.S. taxes if more than 80 percent of the owners are the same as when the company was headquartered here. Companies that moved before last Sept. 11 would have to resume paying U.S. taxes by 2004.
“It is unconscionable that corporations are shifting their tax burden onto other taxpayers by expatriating their headquarters to foreign countries while our country is engaged in a costly fight against international terrorism,” CWA Secretary-Treasurer Barbara Easterling said in a letter to U.S. representatives. “This problem is magnified by the recent projection that the federal deficit will exceed $160 billion during this fiscal year.”
Companies based in the United States have to pay taxes on income earned domestically and abroad. But in countries such as Bermuda, companies only have to pay income on taxes earned within that nation’s borders — a miniscule amount.
The proposed bill, introduced by Rep. Richard Neal (D-Mass.) with 146 co-sponsors, would require American companies that left the United States after Sept. 11, 2001 to resume paying U.S. taxes if more than 80 percent of the owners are the same as when the company was headquartered here. Companies that moved before last Sept. 11 would have to resume paying U.S. taxes by 2004.
“It is unconscionable that corporations are shifting their tax burden onto other taxpayers by expatriating their headquarters to foreign countries while our country is engaged in a costly fight against international terrorism,” CWA Secretary-Treasurer Barbara Easterling said in a letter to U.S. representatives. “This problem is magnified by the recent projection that the federal deficit will exceed $160 billion during this fiscal year.”