Proposed bill fights corporate
foreign tax havens    
Send a link to a friend

Committee passes Hynes bill barring state contracts to corporate expatriates

[FEB. 23, 2004]  SPRINGFIELD -- State Comptroller Dan Hynes' aggressive plan to crack down on corporations that use offshore tax havens to avoid paying their fair share of state and federal taxes was passed by the House State Government Committee Thursday and sent to the full House.

Hynes' plan, HB 4194, sponsored by Rep. Gary Hannig, D-Litchfield, and Rep. Jack Franks, D-Woodstock, will prohibit corporate "expatriates" from doing business with the state and will close a loophole in the Illinois tax code that allows corporations to shift profits to overseas tax havens to avoid paying taxes in Illinois. The bill received the backing of the Illinois AFL-CIO and The Center for Tax and Budget Accountability.

"The concept of this bill is a simple one," Hynes told the committee. "Every corporation should pay what it fairly owes in taxes, just as every individual taxpayer is expected to do. When a small number of corporations take advantage of the system, they are simply shifting a higher tax burden onto individuals, small businesses and the majority of corporations that don't abuse the law. Their actions should not be rewarded with state contracts."

Hynes said five corporate expatriates have benefited from state business in recent years: Accenture, Foster Wheeler Ltd., Tyco International, Ingersoll Rand and APW Limited. Payments to these companies have totaled close to $2.5 million. In addition, the Illinois State Board of Investment has invested in at least three expatriate corporations, including Ingersoll-Rand, Tyco International and Transocean.

 

[to top of second column in this article]

At least eight other states have enacted or are in the process of considering measures similar to the Hynes plan. North Carolina has passed a law making companies that incorporate in a foreign tax haven ineligible to do business with the state. A similar bill became law in California. Montana has revised its tax code to capture the income sheltered in offshore tax havens. Other states considering a crackdown include Ohio, Massachusetts, Minnesota, Pennsylvania and Texas.

Hynes said that at the federal level, legislation has been proposed to make corporate expatriates ineligible for federal contracts and to close down these offshore tax schemes altogether, but to date, Congress has failed to act. "That is why it is imperative that Illinois join the growing list of states that are taking steps to deter corporations from expatriating and close down the tax loopholes that allow them to use offshore havens to avoid paying their fair share of income taxes," he said.

[News release from the office of
 Daniel Hynes, state comptroller]

Back to top


 

News | Sports | Business | Rural Review | Teaching & Learning | Home and Family | Tourism | Obituaries

Community | Perspectives | Law & Courts | Leisure Time | Spiritual Life | Health & Fitness | Teen Scene
Calendar | Letters to the Editor