Accounting Today: Small Business Leaders Urge Closing of Corporate Tax Haven Loopholes

By Michael Cohn
Accounting Today, Dec. 14, 2012 

Hundreds of business leaders who are part of a trio of advocacy groups have signed a letter calling on Congress and President Obama to close corporate tax haven loopholes that cost the U.S. Treasury $100 billion a year.

The letter urges the Obama administration and Congress to reject “revenue neutral” corporate tax reform in a fiscal cliff deal that would have the effect of essentially locking in today’s historically low levels of corporate tax receipts. The business leaders encouraged lawmakers and the President to restore tax revenues lost to corporate tax avoidance and resist lobbying by CEOs to create a territorial tax system that would reward corporations for shifting more U.S. profits and jobs overseas.

The letter was sent by three advocacy groups—the American Sustainable Business Council, Business for Shared Prosperity and the Main Street Alliance—to Congress and the President Friday, saying they “want a tax system that is fair and provides sufficient revenue for the public services and infrastructure that underpin our economy. When powerful large U.S. corporations avoid their fair share of taxes, they undermine U.S. competitiveness, contribute to the national debt and shift more of the tax burden to domestic businesses, especially small businesses that create most of the new jobs.” A total of 626 business owners and executives have signed the letter. 

“We need to stop the gaming of the tax system by large corporations, which undercuts small business and our whole economy,” said Lew Prince, a St. Louis small business owner and leader in Business for Shared Prosperity who recently met with President Obama at the White House. “With corporate profits at 50-year highs and corporate taxes at 50-year lows, the last thing we need is to freeze corporate taxes at this low level through revenue neutral corporate tax reform,” said Prince, managing partner of Vintage Vinyl, the Midwest’s largest independent music store. “There’s nothing neutral about big business tax dodging. It’s unpatriotic plain and simple.”

“Like most small business people, I get frustrated when I hear about big multinational corporations using accounting tricks to shift profits they earn in this country to some foreign tax haven, just so they can avoid their responsibility to pay their fair share,” said ReShonda Young, operations manager of Alpha Express, Inc., a family business that provides 24-hour local, regional and national delivery service, based in Waterloo, Iowa, and a leader in the Main Street Alliance network. “We’re not afraid to compete with the biggest delivery companies out there, but it needs to be a fair fight, not one in which big corporations use loopholes to avoid their taxes, stick our business with the tab, and rob our nation of the resources we need for a healthy economy.” ...

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Copyright 2012 Accounting Today