Big Corporations Make Poor Pay More Taxes

Like many states and like the nation, my home state of CT is facing massive budget deficits that require significant budget changes to avoid bankruptcy and crisis.

I believe there are large amounts of wasteful spending that could be cut from the budget that would close most if not all of the deficit. Unfortunately, what is wasteful for taxpayers is often considered a sacred cow by special interest groups, lobbyists and and the politicians collecting the campaign contributions and other kickbacks from the ones receiving government handouts that they do not need. The regular folks and the poor would be much better off if this type of spending was cut regardless of whether we had a deficit or surplus, but it won’t be cut because of undemocratic, bipartisan corruption and cronyism.

So when cuts are made, they are made on the services that are needed most by the taxpayers, particularly the poor. Shelters are closed. School programs are cut. Emergency services like ambulances and fire departments are cut back. Social workers are let go. Poverty is increased. The poor are told to make sacrifices so the rich don’t have to make the sacrifices.

The alternative to these cuts is more taxes. Politicians may try to increase taxes on the non-rich, again telling us we all need to make sacrifices but really expecting the regular folks and the poor to make all the sacrifices so the rich do not have to. But on this blog I have often pointed out that the rich already pay less in taxes than the rest of us as a percentage of income. Even worse yet, today I read an excellent but upsetting article in the Hartford Current by Jon Green about how big corporations in this state use tax loopholes and avoidance schemes to swindle millions of dollars from the state and thus make the struggling working people and the poor to pick up the tab.

For instance, he explains how AT&T pays itself to use its own logo to avoid paying taxes. Jon Green writes, “Over a period of 2.5 years, AT&T shifted about $145 million in Connecticut earnings to a subsidiary in Nevada, ostensibly paying licensing fees for the right to use the company’s own name and logo. Nevada has no corporate income tax, so the shifted earnings went untaxed and Connecticut lost out. If it sounds fishy, that’s because it is. AT&T is not alone. Many large corporations use sham transactions designed to move profits generated in Connecticut to a different state where they won’t be taxed.”

Published by Scott Hughes

I am the author of Achieve Your Dreams. I also published the book Holding Fire: Short Stories of Self-Destruction. I have two kids who I love so much. I just want to be a good role model for them. I hope what I do here makes them proud of me. Please let me know you think about the post by leaving a comment below!