We learned last week that U.S. Sen. Bernie Sanders (I-Vt.) and U.S. Rep. Jan Schakowsky (D-Ill.) will be jointly introducing the Corporate Tax Fairness Act in Congress.
The act, if passed later this year, will keep profitable corporations from sheltering profits in the Cayman Islands as well as other offshore tax havens.
We like the fairness of the proposed bill and applaud Sanders and Schakowsky for going after America’s fat-cat corporate tax cheats and outsourcers.
According to Sanders, “this bill also would stop rewarding companies that ship jobs and factories overseas with tax breaks.”
It’s stunning to learn just how much tax money—and accompanying jobs—flee U.S. shores. It’s evidence that so many of our large corporations prefer to run the dollar sign flag up the pole ahead of the Stars and Stripes. When given the freedom, these corporations will pledge allegiance to profits over homeland.
While most of us in the middle class trenches are watching our paychecks shrink with new federal taxes in force (I thought the middle class wasn’t supposed to be taxed?), it’s particularly galling to see wealthy, onshore corporate entities “hide” their earnings overseas just to avoid doing what the rest of us don’t especially care for either.
Sanders said the Joint Committee on Taxation has estimated that the provisions in the proposed bill will raise more than $590 billion in revenue over the next decade. That’s a nice chunk of change for Uncle Sam’s coffers; money that would otherwise benefit other nations (as well as other laborers).
Sanders’ and Schakowsky’s Corporate Tax Fairness Act will significantly reform the tax code by ending the deferral of foreign source income that allows U.S. corporations to avoid paying taxes on overseas profits.
What follows is an excerpt of the actual text of Sanders’ and Schakowsky’s proposed bill:
“Under current law, U.S. corporations are allowed to defer or delay U.S. income taxes on overseas profits until this money is brought back into the United States. U.S. corporations are also provided foreign tax credits to offset the amount of taxes paid to other countries. This offshore tax scheme has provided two perverse incentives for American corporations.