Today’s numbers
Thursday, Apr 17, 2014 - Posted by Rich Miller
Posted by Barton Lorimor (@bartonlorimor)
* A new report by the Public Interest Research Group says businesses that pay taxes in other countries through shell companies costs individual Illinois taxpayers $1,396 a year. For small businesses, that number is $4,588. From the coverage…
Every year, corporations and wealthy individuals avoid paying an estimated $184 billion in state and federal income taxes by using complicated accounting tricks to shift their profits to offshore tax havens. Of that $184 billion, $110 billion is avoided specifically by corporations.
…
“This is yet another example of why tax reform needs to be more than just campaign rhetoric,” said U.S. Rep. Dan Lipinski, D-Ill., a co-sponsor of H.R. 1554. “Hard-working middle-class Americans and the small businesses that are the future of this nation should not be forced to carry the tax burden sidestepped by others through the use of offshore accounts. I applaud Illinois PIRG for their exemplary work on this issue.”
Illinois can also take measures to reclaim some of the revenue lost to tax havens. Illinois PIRG found that by passing a simple, proven reform already on the books in other states, Illinois could save $108.3 million annually.
“The Illinois number is striking,” said Illinois state Rep. Greg Harris, D-Chicago. “If big corporations only paid their fair share for one year, the state’s operating budget problems could disappear overnight, elementary, secondary and higher education would be fully funded, MAP grant scholarships doubled, home and health services for senior citizens and people with disabilities fully restored, after-school and anti-gang programs tripled, and every overdue bill paid. So many of the troubles that face our state and communities would be wiped out in an instant if these loopholes were closed.”
A full copy of the report is here.
- PublicServant - Thursday, Apr 17, 14 @ 7:05 am:
===Illinois PIRG found that by passing a simple, proven reform already on the books in other states, Illinois could save $108.3 annually.===
Has Rep. Harris introduced a bill yet? I’d like to track its progress…
- PublicServant - Thursday, Apr 17, 14 @ 7:07 am:
Or does it have to be done on the federal level? If so, I’m sure Boehner and the house republicans will pass it post haste…cough, cough.
- x ace - Thursday, Apr 17, 14 @ 8:12 am:
CAT
- Grandson of Man - Thursday, Apr 17, 14 @ 8:26 am:
I don’t see any tax reform of this type coming anytime soon, at least on the national level. There are too many poor and middle class people who are the political foot soldiers for corporations and wealthy individuals who shield their money in tax shelters. These people slam poor folks who get government assistance–many of whom work–rather than criticize and vote against politicians who fight so that the super-wealthy get every government break available.
- Dan Johnson - Thursday, Apr 17, 14 @ 8:40 am:
I know this is a lazy comment, but Barton could you explain what the reform is that IL can pass and fix the typo from Rep Harris’ quote that IL could save 108 (missing number… Million? Thousand?). I can read the report as well but…you’re the postmaster.
- Anonymous - Thursday, Apr 17, 14 @ 9:07 am:
The legislature is made of up foxes guarding the henhouse. They are not likely to end the gravy train they get in the way of “extras” from the big boys so we all get to have a harder financial life taking care of and protecting the elite interests. What else is new?
- Walker - Thursday, Apr 17, 14 @ 9:25 am:
Hate to say it, but PIRG’s reputation for accurate numbers is about as weak as IPI’s.
This is a big issue, however, and we seem to be afraid to tackle it sensibly.
The opponents of fixing it will continue the refrain of “everyone will leave the state”, while at the same time saying we can have lower tax rates since “we will close the tax loopholes.”
Rather than driving everyone crazy with arguments about location, jurisdiction, and where profits are actually made — let’s do something simple like requiring a modest minimum tax paid by every concern over a certain size, operating in Illinois, regardless of where they claim they should be paying, (or not paying)?
To continue to have extremely successful businesses in Illinois paying us no state tax at all, does rob all of us taxpayers as a group.
- Proud - Thursday, Apr 17, 14 @ 9:32 am:
Remember the age old “Golden Rule— Ye who has the gold, makes the rules!” We in the US have deluded ourselves that we are different! We romanticize our revolution that was really over the wealthy not wanting to pay taxes to the King of England!
- wordslinger - Thursday, Apr 17, 14 @ 9:45 am:
It’s amazing how many people by the con that big business and the super-wealthy are over-taxed.
Pick up an annual report from any publicly traded Fortune 500 company and you’ll see it ain’t so.
- liandro - Thursday, Apr 17, 14 @ 10:38 am:
Tax reform is long, long overdue. Both sides have a lot of donors, er, I mean “reasons”, that pressure them to privately protect the status quo. They can publicly decry this or that specific problem, but I am not holding my breath for real reforms. To easy to blame the other party and sit on your hands.
- Union Man - Thursday, Apr 17, 14 @ 11:10 am:
If only!!
- Amuzing Myself - Thursday, Apr 17, 14 @ 11:40 am:
$108 Million is a far cry from “wiping out” all of Illinois’ budget problems. That quote actually made me laugh.
- Formerly Known As... - Thursday, Apr 17, 14 @ 11:56 am:
=== said Illinois state Rep. Greg Harris, D-Chicago. “If big corporations only paid their fair share for one year, ===
“If legislators only did their job for one year and passed this reform after so many other states already have…”
Fixed that for you, Representative.
- Formerly Known As... - Thursday, Apr 17, 14 @ 12:09 pm:
Although @walker does make a good point concerning PIRG’s reliability when it comes to reputable numbers and projections.
Then again, look at how revenue projections for Illinois’ “pole tax” on strip clubs compare to the recently released numbers. Or how Alderman Danny Solis’ revenue projections from decriminalizing and ticketing small quantities of marijuana compare to the real numbers.
It appears quite a few people have problems making accurate projections when it comes to policies they are in favor of.
- lovecraft - Thursday, Apr 17, 14 @ 1:47 pm:
In the oligarchy this country has become businesses and the richest will never pay their fair share. Instead, the middles class will slowly be bled to death, ushering in a new Gilded Age.
- Lycurgus - Thursday, Apr 17, 14 @ 4:02 pm:
If the feds would reduce the US corporate income tax rate (35%) to something that is globally competitive, this would be a non-issue. But hey, a lot of people like beating the populist fat cat big corporate tax avoidance drum, so why do the hard responsible work of fixing what’s really broken.
- wordslinger - Thursday, Apr 17, 14 @ 4:19 pm:
–If the feds would reduce the US corporate income tax rate (35%) to something that is globally competitive, this would be a non-issue–
C’mon, man. You think anyone’s paying the full freight? What are all those lobbyists doing, then?
After write-offs and credits, the effective U.S. corporate income tax rate is 13%, 17% when you add state and local taxes, according to the GAO.
http://economix.blogs.nytimes.com/2013/11/26/effective-corporate-tax-rates/