U.S.-based multinational corporations are allowed to play by a different set of rules than small and domestic businesses or individuals when it comes to the tax code. Rather than paying their full share, many multinational corporations use accounting tricks to pretend for tax purposes that a substantial portion of their profits are generated in offshore tax havens, countries with minimal or no taxes where a company’s presence may be as little as a mailbox. Multinational corporations’ use of tax havens allows them to avoid an estimated $90 billion in federal income taxes each year.
Tax loopholes encouraged more than 70 percent of Fortune 500 companies – including Nike in Oregon – to maintain subsidiaries in offshore tax havens as of 2013, according to “Offshore Shell Games,” released today by OSPIRG Foundation and Citizens for Tax Justice.
As hardworking Americans file their taxes today, it’s a good time to be reminded of how ordinary taxpayers pick up the tab for the loopholes in our tax laws. OSPIRG released a new study which revealed that the average Oregon taxpayer in 2013 would have to shoulder an extra $1022 in taxes to make up for the revenue lost due to the use of offshore tax havens by corporations and wealthy individuals.