ATF ally The Main Street Alliance placed the following op-ed in The Chicago Tribune. David Borris wrote: “Tax Day is the perfect time to highlight the different sets of rules that apply to small business and big business in our country. While most small business owners (and most citizens) have to file and pay their taxes every April 15, our tax system has been rigged so American multinational corporations don’t.”
Tax Day is the perfect time to highlight the different sets of rules that apply to small business and big business in our country. While most small business owners (and most citizens) have to file and pay their taxes every April 15, our tax system has been rigged so American multinational corporations don’t.
In fact, American corporations are holding $2.4 trillion in profits offshore. For these large corporations, April 15 is just another day because they can defer paying U.S. taxes on these offshore profits as long as they wish. It’s a tax loophole that small businesses can’t – and wouldn’t – exploit.
Across the nation, millions of small business owners get up every morning to open their retail storefronts, their offices, their factories or their distribution centers, and commit to a full day’s work providing the goods and services that make this economy move on a daily basis.
At the end of each week, each month and each quarter, we add it all up, run through the numbers and hope to make a fair profit so we can continue doing what our local communities count on us to do. And then we take a portion of those profits and pay our fair share of municipal, state and federal taxes. Taxes that help pay the way for the critical infrastructure, security and educational systems that allowed us to get our business ideas started and continue to provide critical support to such ongoing operations.
But there the similarities end. Because while millions of small business owners pay their fair share of taxes owed, a host of multinational corporations shirk that responsibility by parking their profits with subsidiaries in overseas tax havens, paying NOTHING in taxes to the country that made them fabulously wealthy. The current tax bill on the $2.4 trillion they are holding offshore? $700 billion dollars!
Worse, these corporations demand that they’ll never bring that money back to the United States, where it can circulate through a still stuttering economy, unless the government cuts them a special deal to pay an extremely reduced tax rate. Instead of paying what they owe, they want a “tax holiday” – a special tax break – to bring home their offshore profits. All the while, they are paying armies of tax lawyers and lobbyists to make certain the laws that make this possible remain unfairly tilted in their favor.
To add insult to injury, they advance a narrative, championed by folks like Donald Trump, that paints the problem as one of a recalcitrant Congress who won’t lower repatriation tax rates far enough for them to bring these critically needed dollars back home.
This is, quite simply, an Orwellian perspective. The reality is these companies seek to shirk their moral responsibility leaving small business owners and working men and women across the country to pick up their tab.
Large Multinational corporations built and continue to run their operations using U.S. railway, airway and roadway infrastructures built with taxpayer dollars. They benefit from hiring workers at all levels who are educated at institutions run in whole or in part with U.S. taxpayer funds, and they are protected from physical as well as intellectual theft by a taxpayer funded security and legal system and taxpayer funded courts.
The responsibility to pay for all of these benefits should be shared in equal proportion by those who collect their benefits. Nothing could be fairer in a real free market. Internalize your profits. Internalize your costs.
In short, tax holidays do not create jobs. They do not incentivize multinational corporations to behave responsibility. They simply reward deadbeat companies for immoral behavior and remind them that as long as the laws do not change, there will always be another tax holiday around the corner.
That is fundamentally unfair to the millions of small business owners who faithfully serve their local communities on a daily basis.
It is time to pay close attention to the smoke and mirror chicanery that masquerades as virtuous tax policy, and use that spotlight to fix a system that unfairly burdens small businesses across the country. Tax Day should mean something to big corporations, too.
David Borris owns Hel’s Kitchen Catering in Northbrook, Il. and is an Executive Committee Member of the Main Street Alliance.