For The Ones That Have More: Tax Breaks Not Enough – They Have To Cheat Too


The Internal Revenue Service
by Linda S. Carbonell
The Federal General Accounting Office has finally gotten through the tax returns of the thousands of companies that received contracts under the Stimulus plan. The bad news is they owe at least $757 million dollars in back taxes. And that was just through 2009 and only three-quarters of the 80,000 companies and groups that received contracts.
It wasn’t just corporate taxes that they weren’t paying. In addition to the $417 million in those, these companies owe $207 million in payroll taxes – money they should be been contributing to Social Security, Medicare and unemployment insurance accounts. The tax debts also go back to 2003.
Federal law does not forbid contracts being granted to companies that owe back taxes, but there are ways to garnish payments to corporations just the way the IRS can garnish your wages for back taxes. Sen. Carl Levin, Democrat of Michigan, said that “We’ve known that a small percentage of federal contractors and grantees who get paid with taxpayer dollars shirk their repsonibility to pay their taxes. The Executive Branch has made it clear that nonpayment of tax can be grounds for denying a specific contract or debarring a contractor from bidding on a contract. Now, the executive branch should get on with it and acutally debar the worst of the tax cheats from the contractor workforce.”
Repubican Sen. Tom Coburn of Oklahoma agreed, “It is a matter of basic fairness that those who take government money should be required to pay their taxes like everyone else. That such a huge amount of the stimulus money went to known tax cheats should be a wake-up call for Congress.”
Aren’t they a little late with that posture? Most of the contracts handed out for support services in Iraq and Afghanistan went to companies that keep their “corporate headquarters” in tax shelter countries like the Cayman Islands. Truck drivers working for those contractors were earning $60,000 a year tax free while our National Guardsmen were making less than a third of that and paying their taxes.
Moira Mack, spokeswoman for the Office of Management and Budget which oversees the stimulus program told the Associated Press that they have collected more than $100 million in back taxes and referred 15 cases to the IRS for investigation. She said that, “Companies that want federal contracts are now required to certify whether they have a significant tax delinquency and that requirement is deterring tax delinquents from getting federal contracts. These efforts are consistent with the steps this administration has taken through the Recovery Act to provide an unprecedented level of accountability and transparency on behalf of the American taxpayer.”
Sen. Orrin Hatch of Utah decided to use the news to attack the stimulus program. He alleges that “This shows how fundamentally flawed the failed stimulus has turned out to be when Washington jams through almost a trillion dollars in spending with little scrutiny.” Hatch should know how that works. He voted each and every time to authorize the spending on Bush’s wars without any accountability for any of the money. He also supported the passage of the Patriot Act without the Wellstone amendment that would have limited Homeland Security contracts to American companies.
It’s really sad that Republicans are so confident of the power of their propaganda machine that they know they can shovel out the hypocritical bull and have it believed by their base.
Related articles
Email Post

Comments

Post a Comment