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NH Small Biz Ranked No. 3: Picking up Tab for Offshore Tax Havens

When it comes to picking up hefty tabs to make up for tax dollars lost to offshore tax havens, small business in the Granite State rank third in the nation, according to a new report. (Revised by Reworked/Wikimedia).
When it comes to picking up hefty tabs to make up for tax dollars lost to offshore tax havens, small business in the Granite State rank third in the nation, according to a new report. (Revised by Reworked/Wikimedia).
December 5, 2016

CONCORD, N.H. -- When big companies abuse offshore tax havens, small business get stuck with the tab. A new national survey ranked the Granite State third-highest in the nation for the tax burden borne by local businesses to make up for revenue lost to tax loopholes used by large corporations.

The report by the MASSPIRG Education Fund said the amount of money corporations book to offshore tax havens is growing. And according to MASSPIRG legislative director Deidre Cummings, that leaves small businesses in the Granite State carrying a tall portion of the tax shortfall.

"In New Hampshire, the average small business pays an additional $6,156 to compensate for that money that large corporations are stashing overseas to avoid paying taxes,” Cummings said.

Supporters of the tax loopholes say they would not be necessary if the U.S. would reduce the top tax rate. President-elect Donald Trump has proposed cutting the top corporate tax rate to 15 percent.

But Cummings said that, in practice, most big corporations already pay less than that. She said multinational corporations and wealthy individuals avoid paying an additional $147 billion in federal and state taxes every year.

Trump has also proposed a one-time tax of 10 percent on money parked offshore in hopes of enticing companies to bring that money back to the U.S. Cummings said these kinds of tax reforms need to be comprehensive and close loopholes to prevent future tax-haven abuse.

"Sure, this time we could do a discount or we could figure out different mechanisms to bring it back in, but it only helps the average taxpayer and the small business if we close that loophole door permanently,” she said.

Offshore tax havens allow big businesses to benefit from the nation's infrastructure without paying the taxes necessary to support it, Cummings said.

"Large multinational companies can thrive because we have security, we have roads and bridges,” she said; "and it's really not fair that the small businesses and the average taxpayer pays for that, and the large multinationals - who you could argue benefit the most - are avoiding that."

According to the report, small businesses in the District of Columbia shoulder the largest tax burden in the nation - more than $7,000 per year in extra federal and state taxes as a result of tax-haven abuse.


Mike Clifford, Public News Service - NH