Senator Carl Levin talks to Reuters correspondent Kevin Drawbaugh about a flurry of new proposed bills targeting tax-eluding shell companies in the U.S. and tax havens abroad.
In a Tax Day opinion piece at USAToday.com, Sen. Carl Levin, D-Mich., writes that the ongoing exploitation of tax loopholes by large, profitable corporations has “helped shift the tax burden onto American families and small businesses, and … added billions of dollars to the budget deficit.”
As chairman of the Senate Permanent Subcommittee on Investigations, Levin has spent more than a decade exposing corporate tax loopholes such as the use of offshore tax havens to avoid taxes. He authored legislation, the CUT Loopholes Act, to combat some of the worst tax loopholes.
Today millions of Americans take part in an annual ritual of filing their income taxes. The willingness of millions of families to plod through this ritual rests in part on the understanding that their burden is shared. Today, though, some of us are bearing a higher burden than ever, while others, particularly our most profitable corporations, sometimes pay no tax at all.
From 2008 to 2010, 30 of the most profitable large corporations paid no federal income tax. None. While the top federal income tax rate for corporations is a relatively high 35%, the effective tax rate for U.S. corporations -- the tax they actually pay -- is less than 15%. I suspect most of the families scrambling today to get their taxes done would love to get that kind of tax cut, let alone the pay nothing, as many large companies do.
This gap between the tax rate on paper and what corporations actually pay has helped drive a huge shift in the tax burden from corporations to American families. In 2011, individuals paid about $6 in income taxes for every dollar that corporations paid. In 1980, the ratio was less than 4-to-1.
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