Monday, September 14, 2015

OFFSHORE TAX EVASION & ECONOMIC COLLAPSE

This is one of the main reasons for Puerto Rico's economic collapse. With the blessing of Congress & the IRS, Puerto Rico is utilized as an offshore tax haven even though it is a  US Territory such as Alaska and Hawaii 
were once. MJR

Companies receiving taxpayer-backed subsidies avoid U.S. taxes
WATCHDOG
By Arthur Kane /Sept 14,2015
U.S. companies that benefited from more than $65 billion in taxpayer-backed loan guarantees have kept nearly $458 billion in profits offshore – avoiding paying billions in taxes to the government that helps them sell goods overseas, a Watchdog.org investigation found.

Using an Export-Import Bank database, corporate records and a database from the Institute on Taxation and Economic Policy , Watchdog.org identified 50 companies that exported billions using bank guarantees yet kept nearly half a trillion dollars offshore and away from the Internal Revenue Service.

The offshore proceeds of the companies benefiting from the bank, if taxed at the 35 percent corporate tax, would have contributed as much as $160 billion to U.S. coffers between 2012 and 2014.

ITEP executive director Matt Gardner said companies are using a loophole to shortchange the taxpayers.
Matt Gardner

EVASIVE MANEUVERS: Matt Gardner, executive director of the Institute on Taxation and Economic Policy, said companies shouldn’t evade U.S. taxes on overseas profits.

“It’s pretty ludicrous that the federal government would subsidize any company engaging in this kind of tax avoidance,” he said. “But it’s not surprising because the way the federal government and Congress spend money and conduct the tax system are basically disconnected. They don’t talk to each other.”

The bank mostly guarantees private lenders or government borrowers for foreign entities who want to buy products built in the United States.

The companies benefiting from the loan subsidy and keeping profits offshore didn’t see a connection.

General Electric and its subsidiaries exported nearly $5 billion worth of products since 2006 using Ex-Im guarantees, and in the past three years kept nearly $120 billion in profits offshore, corporate records and the ITEP database show. That’s more than twice as much deferred taxes as any other company that received Ex-Im guarantees, databases show.

MORE: http://watchdog.org/233679/companies-receiving-taxpayer-backed-subsidies-avoid-u-s-taxes/