Democrats Look To Tackle Costly Corporate Tax Loophole

| by Amanda Andrade-Rhoades
President Barack Obama.President Barack Obama.

Sen. Bernie Sanders is tackling corporate tax loopholes and calling on Republicans to help. “I hope they will join us in making sure that some of the largest, most profitable corporations pay their fair share in taxes,” Sanders, an independent senator from Vermont, said at a Senate Budget Committee hearing on Feb. 3. 

“Each and every year, we lose $100 billion in revenue because large corporations and the wealthy are stashing their profits in the Cayman Islands, Bermuda and other offshore tax havens. That has got to stop,” Sanders said, as reported on his website.

Reuters reported the White House said President Barack Obama, like Sanders, will be targeting the loophole that lets corporations avoid taxes on money that is held abroad. 

On Feb. 2, Obama called for a one-time, 14 percent tax on an estimated $2.1 trillion in profits that are being saved overseas by multinational companies, including General Electric, Microsoft, Pfizer Inc. and Apple Inc.

Obama also wants to impose a 19 percent tax on U.S. companies' future foreign earnings. Currently, foreign earnings are supposed to be taxed at a 35 percent rate, but companies can circumvent that tax through a loophole that defers taxation on income that isn’t brought into the U.S. or repatriated. 

As Sanders seemed to imply, it’s expected the Republican majority will push back against these measures. 

“Instead of cutting programs for some of the most vulnerable people in our society, we have got to make sure that the largest, most profitable corporations pay their fair share in taxes,” he said.

Sources: Bernie Sanders, Reuters Image via Mikebrice/Pixabay