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WASHINGTON--(BUSINESS WIRE)--

Small business owners see corporate tax loopholes and the shifting of U.S. profits to offshore tax havens as serious problems, according to a new independent national poll. Small business owners think big corporations and the wealthy don’t pay their fair share of taxes, the poll shows. They support increasing taxes on millionaire incomes, letting high-end tax cuts expire, and closing the carried interest loophole that gives hedge fund managers big tax breaks.

These findings from a scientific nationwide survey of small business owners released by the American Sustainable Business Council, Main Street Alliance and Small Business Majority are summarized below with links to the full report.

“I’ve been in business 32 years, and I’m appalled at how big corporations and millionaires have shrunk their taxes,” said Lew Prince, owner of Vintage Vinyl, an independent music store in St. Louis, MO. “Ingrates like Amazon wouldn’t even exist without the Internet, which grew out of government research. The least big corporations and their executives could do is pay their fair share for the roads, ports, education, research, public safety and everything else that tax dollars buy.”

“When big corporations use loopholes and tax havens to avoid paying taxes, they’re robbing our country of the resources we need to invest in our future,” said Aimee McQuilkin, owner of Betty’s Divine, a clothing boutique in Missoula, MT and Montana Small Business Alliance member. “If you want to fly the American flag outside your corporate headquarters, you should be paying your way.”

“We need a Buffett Rule for wealthy individuals and a GE Rule for corporations,” said Scott Klinger, director of tax policy for Business for Shared Prosperity, a partner in the American Sustainable Business Council. “Warren Buffett spotlighted the madness of a tax code that lets him pay a lower rate than his secretary. Likewise, U.S. multinational corporations who shift U.S. profits to offshore tax havens shouldn’t be rewarded with a tax rate below Main Street employers.”

“Small businesses are the backbone of the economy, yet they feel the playing field is tilted in big businesses’ favor and small firms are at a disadvantage when it comes to taxes and corporate loopholes,” said John Arensmeyer, founder and CEO of Small Business Majority. “Our economy needs to work for everyone. Policymakers need to listen to small businesses and level the economic playing field. If they do, we will all benefit from what small businesses can offer.”

Key poll findings include:

Small business owners believe corporate tax loopholes are serious problems: 90 percent say big corporations use loopholes to avoid taxes that small businesses have to pay; 91 percent believe the corporate shifting of U.S. profits offshore to avoid taxes is a problem. 75 percent believe their small business is harmed when big corporations use loopholes. Small business owners believe big corporations and millionaires pay less than their fair share of taxes: 67 percent believe this for big corporations; 58 percent believe this for households with annual incomes over $1 million. Small business owners support tax proposals that raise revenues: 57 percent say millionaires should pay more taxes. 51 percent say tax cuts on annual household income over $250,000 should end. 81 percent favor eliminating the “carried interest” loophole that gives big tax breaks to hedge fund managers. Respondents were politically diverse: 50 percent identified as Republicans, 32 percent Democrats, and 15 percent independents.

Read the report:
http://www.asbcouncil.org/uploads/Taxes_Poll_Report_FINAL.pdf
http://mainstreetalliance.org/5535/poll-taxes/
http://www.smallbusinessmajority.org/small-business-research/downloads/020612_Taxes_Poll_Report.pdf

Poll results are from a scientific national survey of 500 small business owners, commissioned by ASBC, MSA and SBM. The nationwide Internet survey was conducted by Lake Research Partners between December 8, 2011 and January 4, 2012. Margin of error +/- 4.4%.

http://www.asbcouncil.org
http://www.mainstreetalliance.org
http://www.smallbusinessmajority.org

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Poll: Small Business Owners Say Big Businesses, Millionaires Not Paying Fair Share of Taxes

The White House has a new election-year plan to stop companies from shopping overseas for tax havens.

While details remain sketchy, the concept outlined by President Barack Obama in his State of the Union address seems crystal clear: Start taxing foreign profits.

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The administration figures that if the IRS gets to collect the money anyway, then multinationals have less of a reason to move jobs out of the country. The tax could deter companies from hopscotching around the world to whichever country cuts them the best deal.

“We are trying to discourage the race to the bottom,” explained White House economics adviser Gene Sperling. “We’re trying to discourage the notion that when somebody is thinking about where to locate production or services, that they should not believe that they can go to a tax haven as a way of having a tax advantage over a company that chose to stay in the United States.”

Still, with Congress and the White House at loggerheads at nearly every turn — and no expectation of change before the November elections — Obama’s tax call appears much more of a campaign rallying cry than a proposal on the verge of becoming law. The president clearly has positioned tax reform as a lever for lifting employment, blaming the exodus of work overseas on a misguided federal Tax Code.

“From now on, every multinational company should have to pay a basic minimum tax,” Obama told a joint session of Congress in his State of the Union address. “And every penny should go towards lowering taxes for companies that choose to stay here and hire here in America.”

In practice, though, tweaking taxes to boost employment might be easier said than done.

Corporate tax policy has become a source of tension for the administration. Union leaders objected last month when the president’s Council on Jobs and Competitiveness recommended lowering tax rates to internationally competitive levels. Meanwhile, Obama’s call for a “basic minimum” tax on worldwide earnings could thwart any kind of consensus with Republicans on reforming the code.

Until the administration discloses more specifics around its 2013 budget proposal in a couple of weeks — like what the rate might be — Republican lawmakers and business leaders are reserving judgment. But not surprisingly, they have serious concerns.

Many congressional Republicans and several corporate executives on Obama’s own jobs council want the government to adopt some kind of territorial tax system, where the United States would not tax income earned outside its borders.

A territorial system would let companies bring foreign earnings home without being required to pay as much as 35 percent to the government. Business profits totaling $1.4 trillion are trapped overseas to avoid those taxes, according to JPMorgan Chase.

“If the rate is too high and the administration doesn’t intend to move to a territorial system like nearly all of our global competitors, then it is tough to imagine how this benefits American companies and the workers who we want to hire here at home,” a Republican congressional staffer told POLITICO.

The White House and congressional Republicans support the general idea of lowering corporate rates and eliminating some deductions to broaden the tax base. But because of the nation’s burgeoning deficit, Treasury Secretary Timothy Geithner says companies shouldn’t count on a massive windfall from any changes.

“When we do tax reform, we’re going to have to be helping contribute to deficit reduction,” Geithner said in an interview that aired Sunday on CNN’s “Fareed Zakaria GPS.” “We don’t have the ability of offering the American people or the American businesspeople community a net tax cut.”

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Bid to tax global profits political?

The Australian Tax Office is seeking increased penalties for
offshore tax evasion. Photo: Michel O'Sullivan

THE Australian Tax office is pushing for more powers to
investigate secret tax havens as well as increased penalties
for offshore tax evasion.

Documents released under freedom of information reveal that the
Tax Office and other law enforcement agencies participating in
Project Wickenby, an inter-agency taskforce targeting offshore
tax evasion, have been quietly developing a comprehensive raft
of new measures to combat abuse of ''secrecy havens'' -
overseas countries with secretive tax or financial systems that
offer minimal taxes for non-residents.

The Tax Office wants the new measures to stem tax evasion
introduced before funding for Project Wickenby expires in 2013
and they are expected to be considered by the federal
government this year.

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Documents released by the Attorney-General's Department show
the Tax Office has been working with the Australian Crime
Commission, Australian Federal Police, Commonwealth Director of
Public Prosecutions, the Australian Securities and Investments
Commission, the anti-money laundering agency AUSTRAC and the
departments of the Treasury, Attorney-General and Immigration
and Citizenship to develop tax reform proposals.

These include improved information flows between Australian
government agencies; greater use of telecommunications
interception powers; expanding the definition of money in
anti-money laundering laws, greater information exchanges with
foreign governments; strengthened international debt recovery
measures; and reciprocal recognition of foreign tax debts.

The agencies have also been considering increased penalties for
offshore tax evasion.

A number of measures were canvassed in a submission by Treasury
to federal cabinet on May 16 last year.

Further reform proposals were forecast for submission to
cabinet late last year or early this year.

But the Attorney-General's Department has declined to release
the detailed policy proposals, telling The Age: ''The
finer details of these law reform proposals have not yet been
put to ministers; there have been no major public announcements
on this subject; and the issues are still at the very
preliminary stages of policy development … full disclosure
would … run contrary to the interests of good government.''

Since 2006, Project Wickenby has resulted in 62 people being
charged with serious tax avoidance, money laundering and fraud.
Twenty-one people have been convicted, although the taskforce
has had setbacks, including the abortive legal pursuit of actor
Paul Hogan. Nearly $594 million in outstanding tax revenue has
been recovered and $1.18 billion in tax liabilities has been
raised.

Assistant Treasurer Mark Arbib yesterday confirmed a
''multi-agency working group'' was working on ''cracking down
on illegal offshore tax evasion''.

''We make no apologies for pursuing those who deliberately
evade tax through elaborate schemes,'' he said. ''They are not
just defrauding the government, they are defrauding all
Australians. The government continually consults our
enforcement agencies to improve and strengthen their ability to
catch those who use offshore jurisdictions to avoid tax.''

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New crackdown on offshore tax evasion

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Gibraltar 'not a tax haven by any measure'