Unemployment And The Economy: How To Get Out Of Paying Your Taxes

By Victor Hatley on September 4, 2010, 5:30 am Posted in Finance News

It has been speculated that over $100 billion per year in taxes is lost by the U.S. government through the use of offshoring of profits and relocating company headquarters to locations that will charge less in taxes. To be fair, businesses must make a profit, but many businesses will receive subsidies from the U.S., even after shorting the IRS. Exxon-Mobile posted $19 billion in profits, yet received a $156 million tax refund, imagine that.

How Does That Happen

Government spending using the tax code…tax expenditures. These tax expenditures can be handed to the oil and gas industry companies through subsidies. They hand them out through deductions, credits, exclusions, deferrals, and the dreaded reduction of tax rates. It has been projected that these subsidies could cost the taxpayers $3 billion in the next calendar year and over $20 billion in the next 5.

Repercussions Of Cutting Them Off

The Office of Economic Policy has stated that doing away with the subsidies enjoyed by the oil and gas industries would only effect domestic production by one half of one percent, and the oil companies can take this hit. Industry officials recognize that this wouldn’t effect the profit margin as much as other actions, one industry official said “We are advocating for opening up public resources. [Support for oil companies] is fundamentally about what you want your public policy to do.”

 

What The Options Are

Any company that is U.S. based and operates a factory or plant outside of our borders should be charged a heavy import tax when they bring their products back to U.S. soil. Government contracts should not be available to any non-U.S. based company, and if they relocate after the contract is established, cancellation, or refusal of repeated contracts. Companies that employ laborers outside of the U.S. could be charged a higher tax rate, to encourage U.S. economic development. There are a lot of no-brainers that could be used to keep the jobs…and money, here.

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