How corporations dodge taxes

(CBS News)
Our government is in knots over ways to lower the federal budget deficit. Well, what if we told you we found a pot of money – over $60 billion a year [another report claims U.S. companies are holding $1.2 trillion overseas] – that could be used to help out?

That bundle is tax money not coming in to the IRS from American corporations. One major way they avoid paying the tax man is by parking their profits overseas. They’ll tell you they’re forced to do that because the corporate 35 percent tax rate is high in relation to other countries, and indeed it seems the tax code actually encourages companies to move their businesses out of the country.

Companies searching out tax havens is nothing new: in the 80s and 90s there was an exodus to Bermuda and the Cayman Islands, where there are no taxes at all.

When President Obama threatened to clamp down on tax dodging, many companies decided to leave the Caribbean. But instead of coming back home, they went to safer havens like Switzerland.

Several of these companies came to a small, quaint medieval town in Switzerland call Zug.

The population of the town of Zug is 26,000; the number of companies in the area is 30,000 and growing at an average rate of 800 a year. But many are no more than mailboxes.

Texas Democratic Congressman Lloyd Doggett questions whether the recent moves of several companies are legit. “A good example is one of my Texas companies that’s been in the news lately, Transocean,” Rep. Doggett told [Leslie] Stahl.

Transocean owned the drilling rig involved in the giant BP oil spill. They moved to Zug two years ago.

“I’m not sure they even moved that much. They have about 1,300 employees still in the Houston area. They have 12 or 13 in Switzerland,” Doggett told Stahl.

“And yet they claim that they’re headquartered over there,” Stahl remarked.

“They claim they’re Swiss. And they claim they’re Swiss for tax purposes. And by doing that, by renouncing their American citizenship, they’ve saved about $2 billion in taxes,” Doggett explained.

Stahl and “60 Minutes” decided to visit their operations in Zug.

A woman at the door told Stahl, “At the moment my boss is not here.”

She said her boss wasn’t there and we should call someone halfway around the world, in Houston.

“But this is the headquarters,” Stahl remarked.

“I know,” the woman said.

When asked if the CEO was there or is normally at the Zug office, the woman said “No.”

http://www.cbsnews.com/video/watch/?id=7360932n

US Uncut’s Tax-Dodging Protests Go Global

by Allison Kilkenny

The founder of US Uncut is ready to take the movement to the next level. Carl Gibson tells me he wants to help shape a simple piece of legislation to end overseas tax havens. Of course, his would not be the first attempt made at such an endeavor. In 2008, Carl Levin [1] crafted the Stop Tax Haven Abuse Act, legislation then-Senator Obama threw his support behind, and which has, like most bills that make sense, been floating in purgatory ever since.

Reportedly, Senator Levin’s chief investigator, Bob Roach, will present updates on the status of STHA during a session called “US Congressional Offshore Initiatives” at the 9th Annual OffshoreAlert Conference [2] in—why not?—South Beach, Florida April 4-6.

But in the meantime, Gibson, working in concert with the Roosevelt Institute’s Cornell chapter, is drafting a streamlined version of an anti–tax haven bill focusing on a clear message. “Mainly, that we’re losing out on upwards of $100 billion every year in lost revenue because of corporate tax dodging and overseas tax havens,” he says.

He hopes to have the bill ready by Tax Day [April 18 this year]. “This will be legislation that makes it illegal for corporations to move income earned within the United States offshore through corporate tax loopholes, so it would close loopholes and it would also force these companies who already have billions overseas to bring that money back to the United States and pay taxes on it.”

More at The Nation

All-out Class Warfare!

Maine Gov. Paul LePage extends war on workers to war on art about workers

by Laura Clawson

Maine Gov. Paul “elected with 38% of the vote” LePage apparently isn’t content with going after collective bargaining rights for workers, raising pension contributions for public employees while exempting himself, and a host of other measures designed to drive down wages and working conditions.

No, his anti-worker crusade extends to artwork.

LePage has ordered a labor history mural removed from the walls of the state’s Department of Labor, and conference rooms renamed so they won’t honor labor leaders.

More at Daily Kos

A brief, and brutal, history of the Chamber of Commerce

by Joan McCarter

Bill McKibben, Kossack, author, and co-founder of 350.org, a global campaign to fight climate change writes the definitive short history of the Chamber of Commerce:

From the outside, you’d think the U.S. Chamber of Commerce must know what it’s doing. It’s got a huge building right next to the White House. It spends more money on political campaigning than the Republican and Democratic National Committees combined. It spends more money on lobbying that the next five biggest lobbyists combined. And yet it has an unbroken record of error stretching back almost to its founding.

The article goes on:

It starts with the New Deal. The Chamber “accused Roosevelt of attempting to ‘Sovietize’ America; the chamber adopted a resolution ‘opposing the president’s entire legislative package.'” Opposition to FDR continued, shockingly, through the Lend-Lease program, designed to supply the allies with critical material to fight the Germans, and which brought a tremendous boon to American manufacturing. But more, the Chamber opposed American involvement in the war, the war which “triggered the greatest boom in America’s economic history.”

Bill McKibben:

But it’s precisely the kind of blinkered short-sightedness that has led the U.S. Chamber of Commerce astray over and over and over again. They spent the 1950s helping Joe McCarthy root out communists in the trade unions; in the 1960s they urged the Senate to “reject as unnecessary” the idea of Medicare; in the 1980s they campaigned against a “terrible 20” burdensome rules on business, including new licensing requirements for nuclear plants and “various mine safety rules.”

The article continues:

Now, of course, the Chamber fights everything from healthcare reform to environmental action. It’s in the environmental realm, McKibben argues, that the Chamber is shooting American business in the foot, yet again.

McKibben:

That’s why thousands and thousands of American businesses concerned about our energy future have already joined a new campaign, declaring that “The US Chamber Doesn’t Speak for Me.” They want to draw a line between themselves and the hard-right ideological ineptitude that is the U.S. Chamber.

More at Daily Kos

Global Class Warfare: The Fight Joined

by Tasini

I suppose maybe I’m a bit weary of the “check out this new outrage by Scott Walker’s assault on the workers” so time to be positive, forward-looking, at least for a moment, by thinking about a really intriguing effort by the United Auto Workers to take a serious shot at organizing against the stupendous class warfare–by taking it around the globe.

So, in my opinion, and I do not think this is a particularly original thought, there is just no way to defeat the current state of class warfare by keeping the offense within our own borders. Our world is littered every day with examples of the global scale of class warfare–whether it be the worldwide financial pollution brought to us courtesy of Goldman Sachs-Citibank-Robert Rubin-AIG et al or the foolish wage-depressing assault via, among other things, middle-class destroying trade deals.

To which the UAW says:

The United Auto Workers outlined a new push to recruit U.S. workers at one or more foreign auto makers and will bolster the effort by training and sending activists abroad to organize rallies and protests in support of the union campaign.

On Tuesday, UAW leaders meeting here described plans to reach out to foreign unions and consumers in what would be their first major campaign since failed efforts in the last decade at Nissan Motor Co. and auto-parts supplier Denso Corp. They hope to be more successful by reaching out to foreign unions at the auto makers’ overseas plants and bringing pressure from prayer vigils, fasts or protests at dealerships.

And…

The UAW has set aside tens of millions of dollars from its strike fund to bankroll its campaign. International actions are to be coordinated with foreign unions and run by some three dozen student interns recruited globally, UAW officials said. When the interns return to their home countries after learning about the UAW efforts in the U.S., they’ll be expected to organize protests against the auto maker, UAW officials said.

The UAW also set up a team to identify weaknesses of foreign-owned auto makers that it can use to apply public pressure, according to a person familiar with the matter. This could include highlighting matters such as past safety problems.

More at Daily Kos

Nike claims lies about sweathop conditions constitutes “free speech”

by Glen Emerson Morris

A law suit in California may have a profound effect on how businesses defend their business practices in public, especially on the Internet. For those not familiar with the case, Nike is being sued by a California activist named Marc Kasky for violating California’s truth in advertising law. After being thrown out by lower courts, the case has landed in the U.S. Supreme Court. If the court decides the case should be heard, a new legal standard will be set.

The issues in the case are simple, the implications are not. After losing business in the mid-nineties to charges of funding sweatshop conditions overseas, Nike publicly denied there were major problems, and claimed it enforced a “Code of Conduct” that prohibited overseas factories from abusing workers. Nike did not include these denials in its ads, just in press releases and public statements. The law suit claims Nike knowingly lied about working conditions to improve sales, which amounted to advertising, and therefore the denials are subject to the truth in advertising law.

In its defense, Nike denies the charges of sweatshop conditions, but has chosen to try to avoid court completely on the grounds that its press releases and public statements weren’t ads, and therefore weren’t covered by the California truth in advertising law. Instead, Nike claims the denials were made as free speech, and protected by the First Amendment. Under this argument, whether the denials were the truth or lies is irrelevant.

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