The cost to taxpayers? An estimated $100 billion a year. Offshore schemes aren't limited to public corporations. Private equity underwriters (PEU's) use the same venue to avoid changes in "carried interest" taxation, profits from investments earned by PEU managers. Those who have more, don't pay more, they go offshore. Most citizens lack funding to sail to Tax Haven Island.
A majority of America's largest publicly traded companies and the U.S. government's largest federal contractors -- including some receiving millions in federal bailout money -- use multiple subsidiaries in offshore tax havens to conduct business and avoid paying U.S. taxes, a new report finds.
Citigroup and Morgan Stanley set up hundreds of tax haven subsidiaries, along with American International Group and Bank of America. Also in the tax-haven list are well-known companies and such federal contractors as American Express, Pepsi and Caterpillar.
GAO, searching publicly available data filed with the Securities and Exchange Commission, determined that 83 of the 100 largest publicly traded corporations and 63 of the 100 largest federal contractors maintain subsidiaries in countries generally considered havens for avoiding taxes.
Friday, January 16, 2009
While the U.S. taxpayer sends billions to corporate coffers, many of the same American businesses have offshore tax havens. The Washington Post reported:
by PEU Report/State of the Division at 4:36 PM