Close Corporate Tax Loopholes

No company should be able to game the tax system to avoid paying what it legitimately owes. And yet, establishing shell companies in offshore havens, or in neighboring Delaware, for the purpose of tax avoidance is becoming more the rule than the exception for at least 83 of the nation's top 100 publicly traded companies. GE, Google, Goldman Sachs and dozens of others have created hundreds of phantom entities with nothing more than a clever tax attorney and P.O. box. The problem is so bad in Pennsylvania that 74% of corporations don’t pay any state taxes at all.

The official estimate of how much Americans lose in tax revenue is $150 billion per year. Just the Delaware loophole alone costs Pennsylvania half a billion dollars every year. That's money that is shouldered by average taxpayers, either through additional taxes today or additional debt to be paid by the next generation.

It’s not illegal, but it’s not right.

The result? The average Pennsylvania taxpayer paid $847 more this year to cover the $150 billion that GE and others that use offshore tax havens skipped out on. And small businesses and companies that don’t use these schemes have to struggle to compete with those that do.

Meanwhile, the Pennsylvania Legislature and Congress are considering deep cuts for essential public programs — from education, to health care, to clean air and drinking water. They’re asking us to tighten our belts and make sacrifices, while giving the tax haven crew a free ride.

We are pushing for commonsense changes that simply say if corporations are based here and generate profits here, then they should, like all of us who earn income in here, pay the taxes they owe.