Read "The Hidden Cost of Offshore Tax havens: State Budgets Under Pressure from Tax Loophole Abuse" report here.
CHARLESTON, W.Va. -- American corporations using offshore addresses to avoid paying domestic taxes cost West Virginia $106 million last year, according to a national report released Wednesday.
The report -- "The Hidden Cost of Offshore Tax havens: State Budgets Under Pressure from Tax Loophole Abuse" -- was prepared by the national nonprofit group United States Public Interest Research Group. The report was released locally by the West Virginia Citizen Action Group at the state Capitol on Wednesday.
"Tax dodging is not a victimless offense. When corporations skirt taxes, the public is stuck with the tab. And since offshore tax dodgers avoid both state and federal taxes, they hurt everyday taxpayers twice," said Dan Smith, PIRG's tax and budget advocate. "West Virginia should be using that money to benefit the public."
Gov. Earl Ray Tomblin has asked many state agencies to cut their budgets by 7.5 percent.
"Before politicians in Charleston and Washington cut critical education, health-care and public safety programs they need to first make sure that millionaires and big corporations pay their fair share of taxes," said Gary Zuckett, CAG's executive director.
"That means closing loopholes that allow them to hide income and profits in overseas tax havens where they dodge paying U.S. taxes," Zuckett said.
Ted Boettner, executive director of the West Virginia Center on Budget & Policy, said West Virginia "collects less in corporate taxes last year than it did two decades ago. In 1990, the business franchise and corporate income taxes made up almost 13 percent of our general revenue fund. Today, they are less than 5 percent.
"Businesses receive great benefits from our collective investments in public structures -- including an educated workforce, basic infrastructure like roads, and police and fire protection -- and they need to pay their fair share," Boettner said.
He said that in West Virginia, personal income taxes increased by 227 percent and consumer sales taxes rose by 161 percent between 1990 and 2011. During those same years, corporate net income and business franchise taxes dropped by 15 percent, according to the state Budget Office and the U.S. Census Bureau.