Archives

NC Budget and Tax Center
Greensboro presser

Allan Freyer at Greensboro event

As details continued to emerge throughout the day about a possible short-term Federal budget deal for 2014 and 2015, it became increasingly clear that the deal represents a missed opportunity for a long-term resolution to our nations’ budget challenges and a bad deal for America’s workers. Although completing any deal is a step in the right direction after two years of partisan gridlock and the recent government shutdown, this deal just doesn’t go far enough—it fails to replace a majority of the sequestration spending cuts and does not include any new tax revenue. As a result, this mini deal represents a big missed opportunity.

This was the message sent by a crowd of workers, families, and advocates that gathered in Greensboro this morning for an event calling on their federal elected representatives to finish the job and replace sequestration in its entirety with new revenues raised by closing corporate tax loopholes. Across-the-board sequestration spending cuts are harming North Carolina, advocates said, and without new revenue, North Carolinians will continue to be hit hard by spending cuts to core initiatives like education, job training, and healthcare.

“This emerging deal represents a missed opportunity. Congress has one last opportunity to prevent damaging cuts to investments that help struggling families and a struggling economy,” said Allan Freyer, Policy Analyst with the Budget & Tax Center, a project of the NC Justice Center. “We are calling on North Carolina’s federal lawmakers to do the right thing and support closing corporate tax loopholes so that we can make the investments needed to support North Carolina families and end gridlock on the federal budget.”

Read More

NC Budget and Tax Center

When Thanksgiving rolls around, no one wants to watch someone else eat all the turkey and then have to pick up the grocery bill all by themselves. But that’s what’s happening in our nation’s budget debate—highly profitable multinational corporations are using special tax loopholes, credits, deductions, and outright giveaways to avoid paying their fair share of taxes while asking the rest of us to pick up the tab for fixing our nation’s budget challenges through spending cuts to key investments that help grow the economy. Even worse, at a time when many families will be celebrating their Thanksgiving blessings or sharing those blessings with less fortunate friends and neighbors, many in Congress are trying to protect these tax loopholes while simultaneously cutting federal food assistance for hungry families.

That’s why N.C. Policy Watch and the N.C. Budget and Tax Center are continuing to shine a light on corporate tax dodging. In recent years, corporate profits have neared record highs while corporate tax collections are at a 30-year low, so now is the time to raise new revenues, rather than asking hungry families to bear the brunt of addressing our nation’s budget challenges. And an excellent source of new revenues involves the billions of dollars in corporate tax loopholes, deductions, credits, and outright giveaways that allow too many multinational corporations to avoid paying their fair share of taxes. So instead of giving all the turkey to profitable corporations and asking the rest of us to foot the bill, let’s ask these profitable companies to pay their fair share for Thanksgiving dinner.

To underscore this message, N.C. Policy Watch and the N.C. Budget and Tax Center are continuing to profile a number of corporate tax avoiders with strong connections to North Carolina (Click here to read previous profiles of Duke Energy, Merck & Co. and International Paper).

And keeping with the holiday theme of food, this month, we’re focusing on the highly profitable fast food giant Yum! Brands, revealing the following:

  1. the size and scope of their businesses,
  2. the taxes they have avoided paying in recent years, and
  3. the methods they use to accomplish this.

Read More

NC Budget and Tax Center

The government shutdown finally ended last week, but the fight for a balanced approach to the federal budget continues. As part of the deal struck last week, Congress agreed to negotiate a comprehensive budget agreement that addresses sequestration and opens the door for new revenues. Perhaps the best potential source of new revenues comes from reining in the special tax loopholes, deductions, and outright giveaways that allow too many corporations to avoid paying their fair share in taxes.

Over the last year, we’ve profiled some of these tax loopholes, along with the corporations that use them to avoid their responsibilities. This month’s issue takes a look at IBM, which earned $45 billion in profits over the past five yeas, and managed to shelter almost $20 billion of those profits in offshore bank accounts to avoid US taxation. As a result, Big Blue managed to lower its actual effective tax rate to 5.8 percent, well below the statutory corporate tax rate of 35 percent.

As long as corporations like IBM are able to avoid paying their taxes, the rest of us will be asked to pick up the tab for addressing our nation’s budget challenges through spending cuts to key investments that grow our economy and protect our most vulnerable.

For more details, see the profile on IBM.

NC Budget and Tax Center

As multiple news outlets are reporting, Congress appears poised to secure a deal that re-opens the federal government, allows the US Treasury to pay its bills by lifting the debt limit, and establishes formal talks to develop a long-term strategy for putting our nation’s fiscal house in order. Assuming Congress passes the deal, these new negotiations set up the opportunity for a new approach to the federal budget—one that includes new revenues to support our economy rather than new spending cuts that increase poverty.

The deal itself is straightforward and includes no significant policy concessions to members of the US House of Representative who precipitated the government shutdown as part of efforts to repeal the Affordable Care Act. For details on the deal, see below the fold:

Read More

NC Budget and Tax Center

The Stop Tax Haven Abuse Act (S. 1533) would raise about $220 billion over the next decade by closing tax loopholes that encourage U.S. corporations to move jobs, profits and operations offshore and allow them to not pay their fair share of taxes.  As my colleague has noted, these costly tax breaks are undermining our ability to invest in the foundations of economic opportunity – an educated workforce, research and development, and healthy families.  Across the board cuts, known as sequestration, are taking their toll in North Carolina and closing corporate tax loopholes is the best way to replace a second round of cuts.

Here is just one example of a company that would no longer be able to benefit from tax loopholes if the Stop Tax Haven Abuse Act is passed. Read More