How states can reclaim 1 billion from offshore tax dodgers!
http://m.washingtonpost.com/blogs/govbeat/wp/2014/01/31/how-states-can-reclaim-1-billion-from-offshore-tax-havens/
For years, corporations were--and still are--shifting profits to offshore tax havens, starving Montana and other states of millions in revenues. So the Big Sky state introduced a simple fix: make corporations report profits going to known tax havens and then tax a share of it, relying on the same formula the state uses to calculate how to tax businesses with operations throughout the nation. In 2010, alone, Montana’s solution to the problem raked in $7.2 million in cash.
Last summer, Oregon became the only other state to join it, but there are others who stand to gain millions through making similar changes, according to a new report. Some 21 other states already require corporations report profits generated in and out of the state, according to the report produced by the U.S. Public Interest Research Group, a pro-consumer group countering big banks, insurers, manufacturers and other special interests. If those states had been taxing profits diverted to offshore havens in 2012, they could have generated another billion dollars in revenue, the group estimates.
“With Congress often gridlocked, states should take action to reduce the impact of offshore tax havens on state budgets,” the report’s authors argue.
Estimates of the federal impact vary, but a report last year from the nonpartisan Congressional Research Service cited a range of $10 billion to $90 billion in lost revenues annually. Yet, despite broad support for taxing corporate overseas profits and high-profile stories on the practice, the federal government has yet to do much about the problem. Enter the states.
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