On CNN, Sen. Bernie Sanders (I-VT) explained that Republican refusal to make corporations pay their fair share is the obstruction that is allowing companies like Burger King to avoid taxes by moving to Canada.
Jake Tapper asked Sen. Sanders why nothing has been done about corporations fleeing the country to avoid taxes, and the Vermont senator’s answer highlighted an ugly truth.
Well, I will give you the short and simple answer is that we have a major political party it’s called the Republican Party who apparently see their goal in life is to represent the wealthy and the powerful and to make sure the rich and large corporations pay as little in taxes as is possible, and that’s the struggle that we’re having. But to my mind, not only is this tax inversion an outrage, we are losing now about a hundred billion dollars in federal revenue every year because many of these large corporations are putting their money in the Cayman Islands, Bermuda, and other tax havens. One out of four large profitable corporations today Jake, pay zero in federal income taxes. So we need real tax reform that asks the wealthy and large profitable corporations to start paying their share of taxes.
What they often talk about is the nominal rate, the rate that is on paper which is thirty five percent. According to the last GAO report done in 2010, it should be updated, the effective tax rate is 12.6% not thirty five percent. There’s virtually no corporations that pay the top rate, and as I mentioned a moment ago one out four major profitable corporations pays nothing in federal taxes, and in a given year you have companies like General Electric and Boeing that not only pays nothing in taxes, they actually get a federal rebate.
Jake, here’s another important point. In 1952, corporations contributed about thirty-two percent of the tax revenue of the federal government. Today, that number is less than ten percent, so when you wonder why we have a large deficit and a large national debt one of the reasons is that corporate tax revenues and the percentage of revenues coming in to the federal government is much much lower than it used to be.
Republicans blame a high corporate tax rate and President Obama for companies like Burger King trying to leave the US, but it isn’t true. For decades Republicans have been trying to shift the tax burden away from the wealthy and corporations and on to the people make the least amount of money. The fact that corporations have been able to slash their amount of taxes paid as a share of federal revenue by more than two-thirds shows that Republicans have been successful.
The problem isn’t that taxes are too high. The issue is that Republicans actively obstruct efforts to make corporations pay their fair share. Republicans are enabling corporate tax dodging through blocking all legislative efforts to stop inversions. The truth is ugly, and it something that Republicans don’t want the American people to know.
Republicans want average Americans to pay higher taxes so that the wealthy and corporations can pay less. Bernie Sanders dropped a truth bomb on the Republican Party, and if the American people ever wake up and realize what is going on, the GOP is going to be in for a world of hurt.