Congress should increase the share of government revenue generated from taxes on big corporations — permanently, Sen. Elizabeth Warren (D-Mass.) said Thursday.
“Now that they are feeling the sting from foreign tax crackdowns, giant corporations and their Washington lobbyists are pressing Congress to cut them a new sweetheart deal here at home,” Warren wrote in an op-ed in The New York Times.
“But instead of bailing out the tax dodgers under the guise of tax reform, Congress should seize this moment to take three crucial steps to repair our broken corporate tax code,” said Warren.
The Treasury Department may have objected to the decision of the European Commission in the Apple case, due to concerns over the impact on the authority of Internal Revenue Service, but Warren also said that Treasury has finalized “new country-by-country reporting requirements that could help expose the jaw-dropping variety of tax-dodging schemes multinational companies employ.”
At the Group of 20 summit meeting in China last weekend, President Obama reiterated his support for a cooperative global effort to end the international tax shell game.
Congress should encourage investment in jobs here in the United States. Giant corporations are pushing corporate tax reform proposals that offer a lower permanent tax rate for earnings generated abroad than earnings generated at home, Warren suggested.
She said Preferential tax treatment, either through special rates or deferred due dates is “nuts,” because it “creates a huge financial incentive for American companies to build businesses and create jobs abroad rather than in the United States.”
Warren also said Congress should “level the playing field for small businesses.”
“Small companies in Massachusetts don’t stash profits in the Netherlands. They can’t hire a team of accountants to set up a reverse hybrid mismatch to slash their taxes.”
This puts small businesses at a competitive disadvantage as they end up shouldering more of the burden of paying for education, infrastructure, research, the military and everything else our nation relies on to succeed, she added.
For years, corporate tax dodgers have taken full advantage of all the benefits of being American companies, while searching out every possible way to avoid paying American taxes. Now that other leading countries are starting to get tough on tax enforcement, these tax dodgers suddenly want to move their money back to the United States, Warren said.
