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Treasury Notes

 What They’re Saying About Corporate Inversions

By: Erin Donar

Yesterday, U.S. Treasury Secretary Jacob J. Lew sent a letter about corporate inversions to the leaders of the Congressional tax-writing committees, writing that “Congress should enact legislation immediately — and make it retroactive to May 2014 — to shut down this abuse of our tax system.” He continued that “What we need as a nation is a new sense of economic patriotism, where we all rise or fall together …  We should not be providing support for corporations that seek to shift their profits overseas to avoid paying their fair share of taxes.”

Here’s what Congressional leaders are saying:

Senate Finance Committee Chairman Ron Wyden:

“This inversion loophole must be plugged. As the speed of inversions increases, this will only fuel bipartisan urgency to stop companies from deserting the US. I’m talking with my colleagues and exploring options for addressing this in the near and long term.” 

House Ways and Means Committee Ranking Member Sander Levin:

“I greatly appreciate Secretary Lew’s call for immediate action to shut down this abuse of our tax system. The Republican refusal to act now to stop this abuse explains why more and more Americans believe the playing field is rigged against them. Ordinary Americans can’t change their address to an overseas location in order to avoid paying taxes. We must act now to ensure that big corporations are unable to do just that.”

Senator Carl Levin:

“Secretary Lew’s letter and today’s statement by Senator Wyden are clear evidence of the growing public support for closing the egregious tax loophole that allows companies to avoid paying taxes just by shifting their address to an offshore tax haven. It’s clear that the wave of corporate inversions to avoid paying taxes is accelerating, and it is urgent that Congress act to close the loophole.”

House Budget Committee Ranking Member Chris Van Hollen:

“Secretary Lew is entirely correct: We need not only a ‘new sense of economic patriotism,’ but swift action by Congress to stop corporate inversions.  The bandwagon of companies effectively renouncing their U.S. citizenship for tax purposes needs to be stopped in its tracks. 

“No one doubts that our tax code is broken in many ways, but we cannot use the need for broader tax reform as an excuse to do nothing as more and more companies use this tactic to avoid paying their fair share.”

Erin Donar is the Spokesperson for Tax and Economic Policy at the United States Department of the Treasury. 

Posted in:  Tax Policy
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