Reforming Corporate Tax Policy to Address Global Inequality: Federal Policy Recommendations
Big corporations engaging in tax avoidance will always be one step ahead of the game unless governments ‘walk the talk’ in tackling these dodges and loopholes, and cooperate to overhaul global tax rules. Previous attempts at tax reform have attempted to plug the holes in our international tax system with limited success. As a result, multinational corporations are still paying less tax than before the financial crisis in 2008, and continue to shift as much as 40% of their foreign profits to tax havens.
When multinational corporations, particularly in high risk sectors such as tech, pharmaceutical, oil and gas, and mining, use tax havens and aggressive tax planning to avoid paying their fair share, it is ordinary people, and especially the poorest, who pay the price. The U.S. government must lead and support global cooperation to revise and implement responsible tax policy to tackle tax avoidance and the race to the bottom on corporate taxation.