…This headline is disingenuous as both Red/Blue … Republican/Democrat are beholding to “generous$” donor$…
As usual, Republicans are in corporations’ pockets. Dem Senate candidates should hammer them for it.
Last week, the Obama administration issued new regulations to limit corporate tax inversions. This maneuver, as our own Joan McCarter explained, is "the practice of corporations buying subsidiaries in foreign countries, then renouncing U.S. citizenship to get out of paying U.S. taxes." In other words, another scam by big money to stick the rest of us with the tax bill they should be paying. When Burger King announced plans for such a move last month, Sen. Sherrod Brown (D-OH) said they’d "abandoned their country" and called for a boycott. Damn straight.
On the one hand, we should applaud the White House for taking action, but the problem is that regulatory changes alone aren’t enough to do the job. Sen. Chuck Schumer (D-NY) noted: "The administration wanted to go as far as they legally could, but they’re very careful." He referred to the changes as "a good effort," but added "the only real way to stop inversions is legislative." Schumer urged Congress to craft a stricter definition of inversion and enact a ban on "earnings stripping."
Earnings stripping? You’ll love this. Earnings stripping refers to a practice by which a foreign-based parent corporation loans large sums to—wait for it—itself. How? By loaning, on paper, the money to one of its own U.S. subsidiaries. Then the corporation gets to deduct the interest it is paying—again, to itself—and cancel out, dollar for dollar, taxes on profits it owes our government.
Sen. Ron Wyden (D-OR) called for legislation that would solve the problem for good "before this growing wave of inversions erodes our nation’s tax base." And why hasn’t Congress passed such legislation? You guessed it, congressional Republicans have blocked it over and over again,saying they are waiting for "comprehensive tax reform." Right on cue, we have Sen. Chuck Grassley (R-IA) complaining that President Obama’s move on inversions will "take the pressure off for tax reform." Bear in mind that Rep. Dave Camp (R-MI)—who, by the way, also slammedthe White House’s action last week—proposed just such a comprehensive tax reform plan in February. What happened? House Speaker John Boehner (R-OH) dismissed it, replying "blah, blah, blah," (I’m not kidding, check the link) when asked about its specifics. Now is the time for Democrats—especially those in tight Senate races—to call out their Republican opponents on the issue of tax inversions.
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"The liberties of a people never were, nor ever will be, secure, when the transactions of their rulers may be concealed from them." – Patrick Henry
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