Congress members crack down on corporations who take advantage of offshore tax deals
Members of both houses of Congress in Washington D.C. are working to end offshore tax deals corporations are using to cut costs.
“These companies, these corporations, want to avoid paying their fair share of taxes in the United States, sometimes billions of dollars and yet they want life to go on as usual. They don’t want to be treated any differently,” said Senator Dick Durbin of Illinois.
Lawmakers claim that companies who avoid paying their fair share of taxes in the United States could cost U.S. citizens $20 billion in the next ten years.
So how are corporations getting away with it?
The process, called inversion, occurs when companies move their headquarters overseas, but only on paper to avoid paying U.S. taxes.
“There is something wrong with this picture to me if you are going to desert this country as a corporation,” said Senator Durbin. “Consumers ought to be aware of it.”
Senator Durbin is behind the American Business for American Companies Act, which would work to stop overseas companies from being able to bid on government contracts.
Corporations participating in inversion include McDonalds and Caterpillar, companies that are based in Illinois.
Lawmakers said that inverted companies have gotten an estimated $1 billion worth of contracts over the last five years.