PUERTO RICO is an "US" OFFSHORE TAX HAVEN for Corporations and the local wealthy, but not for the US resident who live there. This article informs of the consequences of the Offshore Tax Havens to the people of Minnesota.
Today Puerto Rico is the vivid tragic example of the economic destruction of a community of US citizens by allowing Corporations and the very Wealthy to live off the backs of the working people.
If this is not stopped cold, the US will end up becoming what people ran away from hundreds of years ago, by coming to America and creating the United States, One Nation under God with Liberty and Justice for All.
Average Citizens and Small Business Owners Pay the Price for Offshore Tax Havens
Offshore Tax Havens Cost Average MN Taxpayer $774 Per Year, MN Small Businesses $3,927
U.S. PIRG, TakeAction Minnesota Release Picking up the Tab 2013:
April 5, 2013, St. Paul – With Tax Day approaching, it’s a good time to be reminded of where our tax dollars are going. U.S. PIRG and TakeAction Minnesota were joined on a press call today by State Representative John Lesch (St. Paul) to release a new study which revealed that the average Minnesota taxpayer in 2012 would have to shoulder an extra $774 in taxes to make up for the revenue lost due to the use of offshore tax havens by corporations and wealthy individuals. The report also found that the average small business in Minnesota would have to pay $3,927 to cover the cost of offshore tax dodging by large corporations.
“Minnesota families and small businesses cannot afford to keep picking up the tab for corporate tax avoidance,” said Greta Bergstrom, Communications Director for TakeAction Minnesota, a statewide people’s network that is advocating for a closing of many corporate tax loopholes in order to raise state revenue.
The report detailed a number of troubling areas for Minnesota, including much higher than average annual additional tax burdens for individual tax filers and small businesses as a result of corporate tax avoidance, including companies using offshore tax havens and tax loopholes to shield their income from state taxes. These include:
- $774 per individual Minnesota tax filer, the second highest additional tax burden in the nation
- $3.3 billion overall, the tenth highest additional state burden in the nation
- $3,927 per small business in Minnesota, the third highest in the nation
- $1.985 billion overall tax burden to Minnesota small businesses collectively, the tenth highest nationally
State Representative John Lesch of St. Paul, said he believes closing corporate tax loopholes is a contrast in choices. “The same money that our state is losing to corporate tax avoidance could be much better used to invest in our public schools, our state parks and to fix potholes. It can help close our $627 million state budget deficit. It’s needed revenue that Minnesotans across our state – including our seniors and our kids — deserve to benefit from and not have squirreled away offshore.”
In Minnesota, a bill championed by State Representative Frank Hornstein and State Senator Scott Dibble (H.F. 1440, S.F. 1237) would close tax haven loopholes, treating certain tax haven corporations as domestic corporations. This would prevent these companies from being able to shift their Minnesota income offshore and is estimated to bring in $36.5 million in the next biennium.
“Tax dodging is not a victimless offense. When companies use accounting gimmicks to move their profits to tax haven shell companies, the rest of us have to pick up the tab,” said Dan Smith, Tax and Budget Advocate for U.S. PIRG and report co-author. “With the nation facing such serious budget challenges, it’s a no-brainer that we need to close these loopholes and stop letting large corporations avoid paying what they should.”
Every year, corporations and wealthy individuals avoid paying an estimated $150 billion in taxes by using complicated accounting tricks to shift their profits to offshore tax havens. Of that $150 billion, $90 billion is avoided specifically by corporations. Many of America’s largest and best-known corporations use these complex tax avoidance schemes to shift their profits offshore and drastically shrink their tax bill:
- Pfizer, the world’s largest drug maker, made 40 percent of its sales in the U.S. over the past five years, but thanks to their use of offshore tax loopholes they reported no taxable income in the U.S. during that time. The company operates 172 subsidiaries in tax havens and has $73 billion parked offshore which remains untaxed by the U.S., according to its own SEC filing. That is the second highest amount of money sitting offshore for one U.S. multinational corporation.
- Microsoft avoided $4.5 billion in federal income taxes over a three year period by using sophisticated accounting tricks to artificially shift its income to tax-friendly Puerto Rico. Microsoft maintains five tax haven subsidiaries and keeps 70 percent of its cash offshore, a total of $60.8 billion, on which it would otherwise owe $19.4 billion in U.S. taxes.
- Citigroup – a bank that was bailed out by taxpayers during the financial meltdown of 2008 –maintains 20 subsidiaries in tax havens and has $42.6 billion sitting offshore, on which it would otherwise owe $11.5 billion in taxes, according to its own SEC filing. Citigroup currently ranks eighth among U.S. multinationals for having the most money stashed offshore.
“It is appalling that these companies get out of paying for the nation’s infrastructure, education system, and security that help make them successful,” added Smith.