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Tuesday, May 26, 2015

Congress Needs to Undo "Offshoring" Profits

For anyone who's paid attention, we know companies can make profits here in the US, in their home country, and then legally "offshore" that profit, those profits and end up not paying taxes on them.

It's disgusting.

It's certainly unpatriotic. And deeply ungrateful, for that matter.

Sure, the leaders of the corporations give great, wide and long lip service to ours being "the greatest nation on Earth" and then they do this, offshore profits.

It's the lowest of the low.

Unfortunately, again, because of "campaign contributions", the leaders of these corporations slipped their Congressional representatives--you know, OUR representatives--a little money, sometimes as low as, say, $5000, and voila! They got this as law, making it legal.

It's insane and stupid and certainly fiscally irresponsible on everyone's part.

The subject came up again Sunday in the New York Times in a short article in the business section:

Piles of Overseas Profits Investors Can See 

but Not Touch

It has become a $2 trillion question. Why don’t companies have to make clear exactly how much of their profits are generated offshore each year and not taxed in this country? Why must investors engage in jujitsu to estimate these figures and the risks associated with them?

Companies, like individuals, do everything they can to minimize their tax bills. And as long as it is legal to do so, companies that book profits in overseas jurisdictions with beneficial tax treatments are perfectly within their rights to keep those earnings out of Uncle Sam’s clutches as long as they can.

The problem is, accounting rules don’t require a company to record a deferred income tax liability on these profits, as long as it says it intends to reinvest earnings in the foreign jurisdiction where they were generated. So the money piles up, contributing mightily to reported corporate profits.

Untaxed foreign earnings disclosed by companies in the Standard & Poor’s 500-stock index last year climbed to more than $2.1 trillion, according to Jack Ciesielski, president of R.G. Associates and editor of The Analyst’s Accounting Observer.

Last year, Mr. Ciesielski said, 322 of these companies generated $182.4 billion offshore, an estimated 19 percent of their total net income.

We need to push our representatives in Congress, for starters, to take these laws off the books. It should no longer be legal to offshore profits.

It's not as though this would be a true increase in their taxes paid. This offshoring is just a big, ugly shell game and it cheats America, it cheats Americans.

How else do they have access to what are supposed to be the world's biggest and best markets if they don't help pay for the infrastructure we all need for it to function?

Yes, it's long since time we need to undo these offshoring tax laws. 

It can't be undone soon enough.

Please contact your members of Congress. Tell them to make offshoring corporate profits illegal:

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