Corporate greed is when a corporation hunts down and takes massive amounts of revenue for itself and yet still wants more.
The headline at Newser.com makes it sound as if someone is breaking the law and committing criminal tax evasion, when they are actually simply following the law so that they don’t have to pay excess taxes. Corporations should prefer to limit their expenses so that they can offer better goods and services at a better price. There is nothing wrong with that.
Here is the headline: “There’s $620B in Taxes the US Can’t Get Its Hands On.”
Apple has skipped out on paying close to $60 billion in taxes on $181 billion it holds offshore, according to a new study. But though the company holds the most profits offshore of any US company, it’s hardly alone: At least 358 American companies hold $2.1 trillion in profits, which would be subject to a 35% corporate tax rate if the funds were to reach the US, according to the review by two left-leaning nonprofits, per Reuters. That means $620 billion could be collected by feds—enough money to eliminate the federal deficit, notes CNBC. Instead, companies move assets to places like Bermuda and the Cayman Islands, where they pay about 6% in taxes. The report finds 60% of companies with tax subsidiaries had at least one in either country, though the Netherlands had the highest number of subsidiaries.
Think $620 billion in potential tax gains is high? The actual number is likely much higher. The report notes just 57 companies disclosed how much they would owe if they transferred their offshore holdings back home. As “nearly 72% of the Fortune 500 operate subsidiaries in tax haven jurisdictions as of the end of 2014 … Congress can and should take strong action to prevent corporations from using offshore tax havens, which in turn would restore basic fairness to the tax system, reduce the deficit, and improve the functioning of markets,” the study from Citizens for Tax Justice and the US Public Interest Research Group Education Fund found.
Does anyone seriously believe the feds can take an extra six hundred billion dollars from the economy without any negative consequences?
Corporations set up shop in low-tax environments in order to survive. They are right to do so. They are able to offer consumers better products because they don’t have to give as much money to the federal government.
Anyone who thinks that extra money would close the deficit isn’t thinking straight. If the feds had more money to spend, they would run up more debt.