Tag Archives: tax money

House bills to fund infrastructure reward big multinationals

U.S. Rep. John Delaney has introduced two infrastructure funding bills — H.R. 1669 and H.R. 1670 — that good government groups say would further incentivize corporate tax dodging, reward the biggest multinational corporations for stashing their profits in offshore tax havens and replace one system riddled with tax loopholes with another.

“Funding infrastructure is a worthy goal, but Rep. Delaney’s bills strike a bad deal for little return,” Michelle Surka, advocate with U.S. Public Interest Research Group, stated in a news release. “By offering up huge tax breaks for the biggest multinational corporations and rewarding tax gimmicks, these bills sell small businesses and future funding for infrastructure down the river.”

The Partnership to Build America Act (H.R. 1669would establish an infrastructure bank funded by profits repatriated from offshore tax havens.

This proposal, however, offers the worst tax avoiders a costly and unwarranted tax holiday, essentially rewarding and further incentivizing tax haven abuse, according to PIRG’s statement.

Under the proposal, multinational corporations would be allowed to bring back up to $6 at a zero percent tax rate for every $1 in bonds purchased, with the exact ratio to be determined by an auction.

The proposed bidding process would open the door to gaming and collusion. The bonds would further reward tax-dodging multinationals by paying them interest.

Contrary to proponents’ claims, the bonds would not offer a cost-free way to capitalize an infrastructure bank. The bill instead offers multinationals a tax cut worth up to $105 billion to capitalize a $50 billion bank.

The Infrastructure 2.0 Act (H.R. 1670) would allow multinational companies to repatriate their existing offshore profits at a tax rate of 8.75 percent — lower than even the 10 percent rate proposed by President Donald Trump.

PIRG says that would mean profitable U.S. corporations subject to the statutory tax rate of 35 percent would get a 75 percent reduction in the tax rate applicable to their foreign earnings — a massive tax break unavailable to any domestic U.S. company or individual U.S. taxpayer.

Further, the bill would set a deadline for Congress to act on corporate tax reform and, if that deadline is not met, a set of a new rules would be enacted that would modify and extend the worst tax loopholes, PIRG said.

“With over $2.5 trillion in corporate profits booked offshore, we could most certainly fund badly needed infrastructure with the taxes owed on money stashed in tax havens,” Surka stated. “But doing so should not further incentivize or reward tax gaming. Rep. Delaney’s bills do just that, and they take us in the wrong direction.”

 

U.S. PIRG, the federation of state Public Interest Research Groups, is a network of researchers, advocates, organizers and students that challenges special interests on issues.

Public hearing on Bucks arena plan set for July 2

A public hearing will be held next month on a plan for the city of Milwaukee to spend $47 million as part of the $250 million public financing package for a new Milwaukee Bucks arena.

Mayor Tom Barrett tells the Milwaukee Journal Sentinel that the city plan won’t be implemented without the Legislature’s approval of the state’s larger share of that public financing package for the $500 million arena. Bipartisan opposition has stalled that state proposal.

But he said it’s important for the city proposal to undergo public review. The first hearing is July 2.

Under the plan, the city would spend $35 million to develop a parking structure downtown and $12 million for public improvements near the arena, including a plaza space.

Gay Mississippi mayor indicted for personal use of tax money

A north Mississippi mayor accused of misusing taxpayer money on several purchases including at a Canadian sex shop was indicted this week on one count each of embezzlement, false pretense and making fraudulent statements.

Southaven Mayor Greg Davis has been under scrutiny since November 2011, when the Mississippi Auditor’s office told him to repay $170,000 for allegedly improper billings, including travel, food, liquor and one bill for $67 at Priape, described on its website as “Canada’s premiere gay lifestyle store and sex shop.”

Authorities said Davis has paid back some of the money, but still owes about $73,000.

The charges in the indictment were related to a car purchase, city gas and a check from a city account. The FBI is also investigating Davis.

The indictment said Davis made fraudulent statements in February 2009, by claiming to have authorization to purchase a car that had been leased by the city. The second count alleges he used city gas in his personal car from February 2009 to January 2010. Count three, the false pretense charge, is related to a $1,000 check paid to Davis from a city account in March 2011.

Davis’ lawyer, Steve Farese, said the mayor will plead not guilty. Farese declined to comment further until he sees the evidence against Davis.

Mississippi Auditor Stacey Pickering said during a news conference in Jackson that the investigation continues and that Davis was booked and released on a $3,500 bond.

Pickering said Davis orchestrated the purchase of city car when the lease was up, paying about $11,000 for a vehicle valued at twice that amount. He also had the city reimburse him for an annual contribution to a political action committee that Davis never paid, Pickering said.

After the allegations of improper spending came to light, Davis announced that he is gay and said he and his wife had divorced. Some of the money that the auditor’s office ordered Davis to repay had been spent on counseling for Davis’ family.

Davis, a Republican, is in his fourth term as mayor of Southaven, a suburb of Memphis, Tenn., that has grown rapidly in recent years to become Mississippi’s third-largest city, after Jackson and Gulfport.

During a hearing in Hinds County in August, when Davis was fighting the auditor’s attempts to garnish his wages, the embattled mayor said he was being “persecuted.”

The Southaven Board of Aldermen voted 6-1 in January on a resolution asking Davis to resign, but the officials had no authority under Mississippi law to make him step down.

Alderman George Payne said that the situation has been a distraction, but Davis can’t be forced from office unless he is convicted of crime or loses an election.

“Obviously it’s made things difficult for the city,” Payne said. “We’re just going to continue to do what we always do, move the city forward. We’re going to try our best to do that.”

Davis served in the state House before he was elected mayor and ran unsuccessfully for north Mississippi’s 1st District congressional seat in 2008. As a legislator and a congressional candidate, he talked frequently about being a fiscal conservative.