Obama Fights Corporate Tax Havens

by Eyck Freymann

The New York Times and the Politico reported yesterday that President Obama is seeking to close the loopholes for corporate tax havens. This, the administration estimates, will increase government revenue by $210 billion over the next ten years. The New York Times front-page article descibes the administration's justification for this new issue -

The White House pointed to a single building in the Cayman Islands that is the official address for more than 18,000 offshore corporations — few of which even have a physical presence on the islands.

The five-story building in the capital city of George Town is known as Ugland House, and it has been the target of withering scorn from American politicians for several years; Obama frequently mentioned it on the 2008 campaign trail.

“Either this is the largest building in the world or the largest tax scam in the world,” the president quipped on Monday.

Obama promised during the campaign that he would close the loopholes that allowed companies to register their "headquarters" as post office boxes in low-tax nations. I'm glad to see that he's doing it: if we want to extricate ourselves from the recession, every company has to do its part. These tax havens not only reduce the government's revenue, they lead to higher taxes for citizens and law-abiding small businesses. The money to get this economy back on its feet has to come from somewhere, as the Republicans have spent the past month reminding us, and I'd rather it came from Halliburton than from a the small businesses of America.

If nothing else, it will be fascinating to watch this debate take place on Capitol Hill. The first big test of Obama's promise to decrease the power of lobbyists in Washington. Thank God for C-SPAN.