Targeting the top-10 corporate tax dodgers, Sen. Bernie Sanders pledged on Friday to close loopholes that allow these large corporations to exploit offshore tax havens in order to avoid paying U.S. income taxes. Last year, Fortune 500 companies reportedly held over $2.1 trillion in accumulated profits offshore to evade paying U.S. taxes.
“Three major profitable corporations not only pay nothing in federal income taxes, they actually got a rebate from the IRS,” Sanders told a town meeting in a student center at Iowa Wesleyan University.
The presidential candidate informed his supporters that General Electric, Boeing, and Verizon paid no federal income taxes between 2008 and 2013. During that period, these three companies amassed more than $102 billion in combined profits, yet they received over $4.1 billion in income tax rebates from the IRS.
In 2012, GE stashed $108 billion in offshore tax havens and would have had to pay $37.8 billion if the loopholes were closed. Receiving hundreds of millions of dollars in tax refunds from the IRS, Boeing and Verizon regularly outsource their jobs to China and other low-wage countries while hiding their profits in tax havens.
Although Bank of America received a bailout of more than $1.3 trillion from the Federal Reserve and the Treasury Department, the bank hid $17.2 billion in offshore tax havens in 2012. Receiving a $2.5 trillion bailout during the financial crisis, Citigroup stashed $42.6 billion offshore to avoid paying taxes in 2012.
Faced with over 1,000 lawsuits accusing the company of selling Zoloft while secretly aware it could cause malformed hearts in newborns, Pfizer operates subsidiaries in 151 tax havens. As the world’s largest drug manufacturer, Pfizer officially holds $74 billion in profits offshore to avoid paying U.S. taxes.
Although the CEOs of Honeywell, Merck, and Corning have retirement accounts worth millions of dollars, these heartless tycoons want to raise the eligibility age for Medicare and Social Security to 70 while making significant cuts to Social Security. Sanders also mentioned that despite the fact that Federal Express receives $1 billion each year from the U.S. Postal Service, FedEx was awarded a $135 million tax refund from the IRS in 2011.
“In America today we are losing $100 billion in revenue every single year because large corporations are stashing their profits in the Cayman Islands and other offshore tax havens,” Sanders asserted.
According to a report last year from U.S. PIRG (Public Interest Research Group) Education Fund and Citizens for Tax Justice, nearly 75% of Fortune 500 companies have tucked away $2.1 trillion in accumulated profits offshore to avoid paying U.S. income taxes. In 2014, at least 358 of these massive corporations maintained 7,622 tax haven subsidiaries throughout Bermuda, Ireland, Luxembourg, the Netherlands, Switzerland, and other havens.
If elected president, Sanders plans to close these tax loopholes in order to create and maintain at least 13 million jobs by rebuilding our crumbling roads, bridges, water systems, railways, and airports. On Friday, Sanders announced his plan to crack down on corporate tax dodgers by closing loopholes allowing U.S. corporations to avoid paying federal income taxes by setting up a post office box in a tax-haven country, artificially inflating foreign tax credits, and using offshore subsidiaries to evade taxes.
Sanders vowed to eliminate tax breaks for big oil, gas, and coal companies, which would result in saving more than $135 billion over the next decade. He also promised to prevent companies from avoiding taxes by corporate inversions. By acquiring or merging with a smaller foreign business, many U.S. corporations have evaded paying taxes by claiming the new company is foreign, when in reality little to no personnel or operations have moved offshore.
By reforming the tax system, Sanders has boldly called out the top 10 corporate tax dodgers that he intends to make pay their fair share, without awarding them enormous tax breaks and massive refunds. Due to the fact that these corporations are also among the largest campaign contributors and SuperPAC donors, no other presidential candidate has the courage to confront them in public and challenge their unfettered avarice.