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Current Events & Hot Topics Current Events & Hot Topics

Billionaire Blasts Companies That Jump Overseas To Duck Taxes: ‘I’m Selling Your Stock’

Posted by on Jul. 27, 2014 at 11:59 AM
  • 5 Replies
Dallas Mavericks owner and billionaire investor Mark Cuban

Dallas Mavericks owner and billionaire investor Mark Cuban

CREDIT: AP

As more and more American corporations have used mergers and shell companies to shift profits and shrink their U.S. tax liabilities over the past few years, there has generally been a sharp divide between populists who decry the maneuvers and investors who celebrate them.

Friday morning saw a high-profile defection from the economic elites’ camp, however, as outspoken billionaire investor Mark Cuban pledged to sell off his holdings in companies that move offshore for tax reasons. “If I own stock in your company and you move offshore for tax reasons I’m selling your stock,” Cuban tweeted.

If I own stock in your company and you move offshore for tax reasons I'm selling your stock. There are enough investment choices here

When companies move off shore to save on taxes, you and I make up the tax shortfall elsewhere sell those stocks and they won't move

Rather than seeking a synthetic boost in their stock price by shifting tax burdens onto others, Cuban said, American companies should persuade investors to accept slower growth in their market returns in exchange for job growth and expansion here at home. His primary rationale is a self-interested rather than a philanthropic or political one, as you might expect from a wealthy investor with a healthy competitive streak. “When companies move off shore to save on taxes, you and I make up the tax shortfall elsewhere sell those stocks and they won’t move,” hetweeted later.

Cuban’s high-profile opposition to corporate offshoring could provide a signal boost of sorts for the Obama administration’s own efforts to encourage a renewed “sense of economic patriotism” among business elites. While President Obama himself has begun speaking against the sorts of moves Cuban decried Friday, the corporate executives who make these decisions may be more receptive to hearing it from one of their own.

As media chatter about offshoring and corporate taxes gets louder, odds of getting actual legislation passed may be improving slightly. The Senate will debate the Bring Jobs Home Act more than two years after it was first introduced. While an actual vote on the measure is still not guaranteed, the last time the bill came up Republicans filibustered it before it could even be discussed fully on the floor. A vote to allow debate on Wednesday represents progress, however marginal and fragile.

The momentum behind such legislation comes in large part from a wave of mergers designed to allow American companies to move their official headquarters to tax haven countries like Ireland. Those mergers, known as “inversions,” have become far more popular in the years since the Great Recession began than they were over the previous two decades. They have also garnered negative attention for companies like PfizerMedtronic, and Walgreen’s that are reportedly considering inversion mergers this year.

Profit offshoring costs taxpayers tens of billions of dollars per year, and the total profit held overseas by American companies now hovers around $2 trillion.


by on Jul. 27, 2014 at 11:59 AM
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Replies (1-5):
Cutenessmom
by Bronze Member on Jul. 27, 2014 at 1:01 PM

Of course this gets no attention becuase, it is not gossip abut each other. This guy gots my money :)

TranquilMind
by Platinum Member on Jul. 27, 2014 at 1:03 PM
1 mom liked this
Good for Cuban.
mjmorrison
by Bronze Member on Jul. 27, 2014 at 1:06 PM

lower the highest in the world tax rate and maybe companies and their jobs will return.

stormcris
by Christy on Jul. 27, 2014 at 2:53 PM

Use and import taxes would remedy the situation. For some, our income tax rates are the same as countries that have universal healthcare and a welfare system. Corporate taxes of 20% increase consumption rates and that is a tax rate for a country that has universal healthcare as well. Our money is not being utilized properly and we have several leaks in the system. Fix that and this broken healthcare crisis and we might get on the road to recovery. Bottom line don't give tax breaks to corporations that operate outside the country. Yes, we have a lot of problems to work on the corruption and greed outshine The Jungle now.

“Into this wild-beast tangle these men had been born without their consent, they had taken part in it because they could not help it; that they were in jail was no disgrace to them, for the game had never been fair, the dice were loaded. They were swindlers and thieves of pennies and dimes, and they had been trapped and put out of the way by the swindlers and thieves of millions of dollars.” -Sinclair

meriana
by Platinum Member on Jul. 28, 2014 at 11:04 AM


Quoting mjmorrison:

lower the highest in the world tax rate and maybe companies and their jobs will return.

Lowering the tax rate would not result in companies bringing work back here since they'd then have to pay a decent wage rather than the extremely small wage they often get away with paying over-seas.  Large companies always claim they are going to or have moved off-shore because of the tax rate because that gets people on board with what those companies want,  a much lower tax rate while keeping all the tax breaks, etc. they already have. There are quite a few billion dollar companies that, due to all the breaks, etc. pay very little in Federal tax and even manage to zero out their tax liability completely.  Lower the tax rate and even more companies will be able to zero out their tax obligation because the tax rate is NOT what they  actually  pay. 


Facebook is a good example: The company made 1.1 Billion in pre-tax profits but due to legal deduction on executive stock options and share awards, instead of paying Federal taxes, the company RECEIVED a refund of over 4 Million.  CTJ describe the fact that the company 'did not pay even a dime in federal and state income taxes' as an 'amazing admission.'   http://www.dailymail.co.uk/news/article-2279701/Facebook-pay-tax-2012-tax-refund-429MILLION-despite-1BILLION-profits.html?ICO=most_read_module


According to a recent analysis of nearly 300 Fortune 500 companies by the Citizens for Tax Justice, the average company was paying just 18.3 percent in taxes -- a little more than half the official rate. And by using techniques like industry subsidies, stock option packages, and moving assets overseas where they can't be taxed, 30 companies mentioned in the report -- including Wells Fargo, Verizon, Boeing and General Electric -- didn't pay a cent in federal taxes in 2008, 2009 or 2010, the report found. 

http://www.huffingtonpost.com/2012/01/10/corporations-pay-no-tax_n_1196875.html


And then we have Walgreens, which is apparently set to become a Swiss company on paper.  While I  haven't found the amount of Federal taxes, if any, Walgreens paid, the company has received,  from the taxpayer of Illinois, taxpayers of Illinois gave it a $6 million tax credit over a period of 10 years,  $625,000 in training money and $875,000 in additional tax incentives. Walgreens had sales of $72 billion last year — a quarter from U.S. government-sponsored health programs.  http://www.detroitnews.com/article/20140613/OPINION01/306130005
http://redecatur.com/walgreens-to-renounce-u-s-citizenship/

The following shows what companies are paying which is not the tax rate.

http://www.huffingtonpost.com/2014/02/25/corporation-tax-rate_n_4855763.html

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