The financial industry is extremely good at evading taxes. That’s one of the takeaway messages of Offshore Shell Games, a report released this week by U.S. PIRG. CitiGroup, Goldman Sachs, Wells Fargo, Morgan Stanley, and JPMorgan Chase have ducked a combined tax bill of $27 billion, the report estimates, by funneling profits to overseas subsidiaries that are often nothing more than P.O. boxes.
“Loopholes in the tax code make it legal to book profits offshore, but tax haven abusers force other Americans to shoulder their tax burden,” the report points out. “Every dollar in taxes that corporations avoid by using tax havens must be balanced by other Americans paying higher taxes, coping with cuts to government programs, or increasing the federal debt.”
Such practices are “ubiquitous among the largest 100 publicly traded companies as measured by revenue.” Altogether, those 100 companies are holding some $1.17 trillion in offshore tax havens, the report estimates.
— Mitch Margolis