Report Finds Major U.S. Companies Have Offshore Tax Havens

The Washington Post ^ | 16 Jan 2009 | Carol D. Leonnig

[BGHater]

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.

The new Government Accountability Office (GAO) report, released today by Sens. Byron L. Dorgan (D-N.D.) and Carl M. Levin (D-Mich.), lists Citigroup and Morgan Stanley as having 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. Dorgan and Levin said they requested the updated report from one several years ago because they are focused on combating offshore tax abuses, which they estimated cause $100 billion in lost U.S. tax revenue each year.

GAO auditors did not review the companies' transactions to independently verify that the subsidiaries helped the companies reduce their tax burden. The GAO said only that the companies had subsidiaries located in jurisdictions considered tax havens and that historically the purpose of those subsidiaries is to cut tax costs.

The practice is legal, but Dorgan and Levin are hoping to gain the support of President-elect Barack Obama for legislation that would outlaw it.

[BGHater]

GAO Report: Internal Taxation

[Lurker]

So begins the feeding frenzy of the looters.

Watch for many of the targeted companies to move out of the US entirely soon.

[squidly]

Then they’ll just move the whole company offshore, instead of merely moving subsidiaries. Then O and Co. can make it against the law for foreign businesses to come do business in the U.S., and we’ll have solved this pesky business problem once and for all!

[goodnesswins]

Hmmmm....they must have Wrangell as an advisor....

[wastedyears]

I wonder why they do that...

[elpadre]

The US is either the most restricted and taxed country for a business to operate, or second worst in the world. Either way, it is a wonder as many stay as do.

[mountainlion]

Ted Kennedy does not pay much federal tax. The family estate is registered off shore to avoid taxes. I suspect that he is one of the lawmakers that made the law.

[combat_boots]

No! Really?

Remember Accenture’s loss of ‘goodwill’ when it moved its HQ to Bermuda?

http://goliath.ecnext.com/coms2/gi_0199-530441/Bermuda-HQ-costs-Accenture-goodwill.html

[The Electrician]

To a smart person, this might indicate that US corporate taxes are “too high”, and they might react by looking at ways in which the tax burden could be reduced in order to make America more globally competitive. But we’re talking about Democrats here, and not about smart people. ‘nuff said...

[combat_boots]

Pure Trust info:

http://www.yourpto.com/about.php

[Carley]

Good for them.

[Lurker]

Whoever edited that webpage should be beaten with sticks.

[Tainan]

"The practice is legal, but Dorgan and Levin are hoping to gain the support of President-elect Barack Obama for legislation that would outlaw it."

Does anyone think PEBO and his incoming crew are going to let a little thing like "legality" stand in their way?

Juan McCain will be the judas goat and get the needed support to get around those bothersome 'legalities.'

[ataDude]

I just glanced at it. They do like capital letters, don’t they? /understatement

[Lurker]

It'll be called a 'loophole' that allows greedy businessmen to hide their money offshore.

The mobs will then demand it. And they'll get it.

None of us is safe anymore.

None of us.

L

[combat_boots]

true, but reading about ptos is a find.

http://members.cox.net/ur2good/whouses.htm

Here. Search for yourself: http://www.dogpile.com/dogpile/ws/results/Web/joseph%20kennedy%20pure%20trust/1/417/TopNavigation/Relevance/iq=true/zoom=off/_iceUrlFlag=7?_IceUrl=true

[Quickgun]

you are exactly right. I do contract work for two of the largest oilfield service companies in the world. Both have moved thier main offices from Houston to foreign countries. Rumor has it that they may severly cut thier US operations, especially those onshore. Some say it's mostly because of the recent drop in oil prices, but they have been through drops many times. I tend to think taxes, litigation.

[ronnie raygun]

Surprise! so do most of our criminal politicials but this is ok, right? they fail to pay taxes but this was an oversite, we all know Frank, Dodd and a host of sickening despicable rats caused the melt down but no one says a word,they now call global warming, global climate change because they can’t explain the deep freeze we’re in and we eat this also, they bail out everyone with our tax dollars with no accountability and ask for more and we sit and say nothing, most lemming Americans are in a celebritory mode for the empty suits inaugeration and the begining of the saviors resue of the world and its problems and some of us say well he may not be that bad. Today the RNC sent me my official membership card and also asked for a donation and I did what we all should do, I dumped it in the trash and e mailed them to say” when you grow some balls and decide to represent us instead of your self interests or your rat friends you now have, then I will support you”.

[goodnesswins]

HA...I tear up their (RNC) envelope (sent) and write my note on their request...and put it back in their postage paid envelope and send it back to them....it costs them money...they THINK they’re getting money back....and they can’t just DELETE IT....

[eaglestar]

This was my expectation going into this election. I expected for many corporations, businesses and the affluent people to move outa here if Obama won the election. I never took tax havens into account but now that they are targeting them the exodus should accelerate much faster leaving Obama and the Democrats with not much to spend.